Having a credit score in the high 700s and above will help you save money over time and allow you to get the credit you want when you need it. A few of the benefits of strong credit scores include:
Lower interest rates
The interest rate you get is often directly tied to your credit score. If you have good credit scores, you'll almost always qualify for the best interest rates on mortgage and auto loans. The interest rate you receive on a loan can make a substantial difference in your monthly payments and the total amount you will end up paying for your home or car. For example, just one or two percentage points less on your mortgage interest rate can save you tens of thousands of dollars over the course of the loan.
Renting an apartment
Landlords often use credit scores to screen tenants and determine their financial trustworthiness. Credit scores can provide insight into how likely it is that you will pay your rent on time each month. A good credit score can increase your chances of getting into a house or apartment and prevent you from having to pay a higher security deposit.
Some car insurance companies factor in credit scores when determining monthly premiums. Although you can't be turned down altogether for insurance based on credit scores, good credit scores can help you qualify for lower insurance premiums.
Security deposits on utilities
If you are a new customer, utility companies may look at your credit report to get a sense of how likely you are to pay your utility bills on time. Having a good payment history and good credit scores will reduce the chances of needing to pay a security deposit when you establish utility service.
Qualify for credit card rewards
Excellent credit will help you qualify for credit cards with low interest rates and other rewards including cash back offers, travel points and other types of incentives.
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Join our live video chat every Tuesday and Thursday at 3:00 p.m. ET on Periscope. Rod Griffin, Director of Public Education at Experian, is available to answer your questions live.
Scoped on: 2/23/2017