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Recommended Personal Budget Category Percentages Debt Settlement Truths - Answering the Critics A Review of LifeLock ID Theft Protection Service Will I Owe the IRS Tax on Cancelled Debt? How to Negotiate a Lower Interest Rate on Your Credit Card
3 Huge Tips to Reduce Credit Card Debt |
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Your Borrowing Ability
Your credit score affects the interest rates you pay on credit cards and also affects the interest rate you will pay on a mortgage loan. The higher your credit score, the better risk you appear to lenders which will lead to lower interest rates on all sorts of loan products.
Your Job
I didn't know this until recently, but your credit score can even affect how a potential employer views your value to the company. The higher your credit score, the better you look to a new employer. However, not all employers will take a look at your credit score, but it's becoming more and more common.
Talk about an important impact, wow! It's amazing to me that your credit score can have an effect on your main source of income -- your job!
Your Insurance
Almost every insurance company these days will check your credit score when you apply for coverage. Whether you are applying to for homeowner's insurance, life, or car insurance, checking out your credit score is fair game.
This is especially true for car insurance companies. They feel (rightly or wrongly) that your credit score tells them something about you, like your temperament and your ability to handle responsibility. Keeping your credit in great shape will ensure you get the best insurance rates.
Your Life
You probably don't have to be reminded, but if you have a low credit score you will also be at risk of being:
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- denied home or car loans - denied a job opportunity - paying high rates of interest on loans - having to pre-pay or pay a deposit for goods and services |
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| What is the price you are already paying for Bad credit? A quick glance at the figures below shows that a good credit rating can save you hundreds in interest charges. | |||||||||||||||||||||
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Example
1: Automobile
Financing
If you are making payments on a car, you are probably paying between $5,000 and $9,000 more in interest just for having bad credit. This added interest shows up every month in a higher payment. Take a look |
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Example 2: Home
Mortgage
Bad credit in auto financing can really hurt, but it is nothing compared to the cost of bad credit when a home is involved. A typical home can cost between $50,000 and $130,000 more in interest if you are buying the home with bad credit, as indicated below. |
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Example 3: Credit
Cards
Most of the time you cannot even get an unsecured credit card with bad credit. If you do, you are generally expected to pay a high monthly payment or initial fee. Furthermore, the limits are typically low and the card issuer often asks for a cash deposit. |
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If your score is hurting...
I've learned that the steps to regaining a good score and your financial freedom after going through a financial difficulty are the following:
1.
Get your Credit Report
2. Dispute negative and
erroneous entries
3. Make lifestyle
changes to improve your credit score
Almost every financial decision you make in your life will most likely in some way revolve around your credit score, so if yours is low, now is the time to get it fixed.
Related Articles:
Good Credit Rules!
Having good credit is one of
the most important building blocks to financial independence.
Learn how getting good credit can help your life.
Follow these tips to
maintain a great credit score
Here are a bunch of tips and suggestions that will put your
score at the top and keep it there.
Learn valuable information
about credit reports
Find out about what could be on you credit report, types of
credit reports and how to get them for free every year!
How to avoid credit repair scams
By knowing what's out there, you can save yourself a ton of
money, headaches and time. Picking the right credit repair
strategy is critical to your financial future.
Improve your
credit score by disputing items on your credit report
By disputing erroneous, inaccurate and
unverifiable entries on your report, you can drastically improve
your score and save hundreds and even thousands of dollars in
interest.
A common question - Is
Credit Repair Legal?
Read my thoughts on the legal and
ethical implications of credit repair.
Get your free Annual
Credit Report
Read my review of
www.annualcreditreport.com and learn how to get your reports
free.
Do It Yourself Credit
Repair
Remove unwanted marks
by disputing them yourself. By applying some basic
techniques and using recent legislation to your advantage, you
can have adverse entries removed much sooner.
Sample Dispute Letter
Use this sample letter format to dispute
items on your credit report.
Playing the Balance Transfer Game
Using balance transfers to avoid high interest rates can work,
but watch out, you could pay for it in the long run.
Your Debt-to-Income Ratio
learn how this important number can play a big part in your
ability to secure a loan.
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Most Popular Pages |
Personal Money Management Basics
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Did You Know... |
49% of adults, and 66% of US high school students got F's on a national test on their knowledge of basic economic principles.
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Food for Thought... |
"I'd rather go to bed without supper than rise in debt."
-Ben Franklin.
