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Advantages of a Good Credit Score

By Janet Lacey
Published: Sunday, October 11th, 2009

You might have heard it pretty much everywhere that you can think of. Nowadays, it is on everybody’s mind and a common topic of discussion at get-togethers. It seems as though credit scores have taken center stage and a topic of discussion that people are inclined to discuss about eventually. Not so long ago, everybody was happy with how they were doing financially and least worried about credit scores. Today, the situation is very different and people are worried about paying bills and maintaining their score and things like that.

In fact, considering the number of advantages that are associated with good credit scores, it is foolish to not maintain your score as you stand more to lose rather with a poor score. The number of problems associated with a poor score is numerous, but once you are aware of the advantages that you get with a good credit score, you might want to think twice about letting anything affect the score. After all, who doesn’t want to enjoy the benefits of a good score?  Considering how they get preferential treatment everywhere, from banks to car dealerships, you too might want to maintain a good score so that you can enjoy similar benefits.

The first big benefit for people with a good credit score is the fact that they get to have the lowest interest rate amongst all of us. The low interest rate can be attributed to the fact that banks have confidence in them being able to pay their loans back. Hence, it is not abnormal for them to enjoy lower rates of interest. This might upset others who are struggling to maintain their score, because they might feel like they are being made to pay more despite having lesser money to begin with. But, the actual reasoning for this would be the fact that most of the people with good credit score have shown strong financial understand and don’t spend money lavishly on unnecessary things.

Additionally, having a good credit score will get faster approval for loans from banks or other financial institutions. A good score is like the symbol of confidence for the banks, and they can trust the individual that they are lending the money to. This is a big deal since not everyone has the capacity to repay loans, and the credit score is reflective of this very phenomenon. A good credit score is also a guarantee of getting the same loan at a much lower rate of interest than compared to those who are applying for the loan with a poor score. Also, good credit score holders always get the loan, regardless of how it might be for others.

Hence, considering the number of benefits that good credit score holders have, it is foolish to want to go in the other direction and let the poor credit score affect you. After all, you will eventually need to borrow money in life if you want to build something or even buy something. When the time does come, you might repent for not taking better care of your credit score. Hence, be wise and start early; try to rectify your spending habits before it gets too late and you can’t do much about it.

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