The Power of a High Credit Score
If you have any type of credit or loan, from a credit card to a car loan to a mortgage, you have a credit score. Whether it’s good or bad depends on your credit history and how well you’ve been able to make regular, on-time payments. A higher score is a better score, but why does it matter? What benefits can you have with a higher credit score? Let’s take a look.
Lower Interest Rates
One of the greatest benefits to having a higher credit score is lower interest rates. Since your credit score reflects your credit history, a higher score means you’ve made payments on time, you’ve rarely been late, and you’ve paid off loans in full. When lenders see a higher score, they are more likely to give you advantages and perks, one of which is a lower interest rate. This means you’ll pay less in interest as you pay off your credit cards over time, thus paying more of what you owe and less to the credit card company.
Higher Credit Limits
Another great perk for keeping your credit score high is higher credit limits. If you open a new card or take out a new loan, lenders are more likely to give you a higher credit limit. The reason is the same for lower interest rates. A higher credit score means you’re trustworthy when it comes to paying off your loans and therefore they can trust you with a higher limit.
Higher scores means you are more likely to have offers come to you rather than you looking for credit offers yourself. Once lenders know you have a great reputation with your credit, you’ll find all kinds of opportunities for loans and offers on your doorstep.
Having a high credit score also opens the door to bigger and better opportunities. It will be easier for you to rent an apartment, apply for a mortgage, buy a car, not to mention you’ll enjoy the best homeowners and car insurance rates.
You’ll also have access to bigger and better credit cards. Not only will your credit limit be higher, but you’ll be able to tap into the high-end cards that come with perks, miles, and points. These benefits work together to give you upgrades on plane tickets, hotel stays, or cash back.
Whether you’re buying a house, a car, opening a new loan, or looking for a new line of credit, having a higher credit score is the key to getting approved, and not only that, to getting a good interest rate as well. Thankfully, obtaining a high credit score is easy to achieve, but it takes time to do so. Make all your payments on time, every time, and be sure to pay off your debts in full rather than maxing out your cards. Work on elevating your credit score, and your credit score will elevate your quality of life.
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