By: Rachel S. Gibbs, MBA, CFEI, BCCC
Good credit is a financial assessment that measures a buyer’s reliability and credit card history usage. Having good credit helps you save more money. An individual’s FICO rating ranges from 300 to 850, and the higher the score, the more reliable an individual is viewed as.
Here are some of the best advantages of having good credit:
Credit Card and Loan Approval
Credit card or loan approval can be difficult if you have a bad credit history. A good credit score does not ensure loan approval due to other factors being considered: income and debt. However, a good credit score gives you a higher chance of getting approved for new credit.
Low-Interest Rates
An interest rate is a cost of borrowing money, and often, interest rates are connected to your credit score.
Your credit score will determine whether you’re qualified for the best interest rates where you will pay lower fees. Lower interest rates let you pay off your debt faster and help you save money.
Negotiating Power
Depending on your credit score, you can utilize it to negotiate a lower interest rate on your loan or credit request. You can also take advantage of other offers you’ve received from various companies depending on your credit score. Unfortunately, creditors are less likely to approve of your loan terms if you have bad credit.
Approval for House Rentals and Apartments
Landlords often check their credit scores as part of their screening process. An eviction mark of an outstanding rental balance can ruin your chances in getting the rent approval as this is in your credit history.
More landlords are using credit scores to screen tenants. Meanwhile, if you have a good credit score, you can save more time in finding a landlord who will approve your rent request.
Increase Credit Limit
The loan amount depends on your income and credit score. Having a good credit score gives you the opportunity to apply for a credit limit increase because banks are going to look into your payment history and once you consistently pay on time, they will be more willing to approve your request.
What Is A Good Credit Score?
A score of 720 or above in a similar range is viewed as good. Most credit score assessment falls somewhere in the range of 600 and 750. Higher scores speak to more credit choices and can make lenders certain that you are able to pay your dues.
For your reference, here is the FICO score assessment chart:
• Excellent: 800 to 850
• Very Good: 740-799
• Good: 670 to 739
• Fair: 580 to 669
• Poor: 300 to 579
Need help with your credit? Contact us now to get started at www.gibbsfinancialfitness.com or call us at 888-776-1809.
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