Monday, September 16

How important are your credit scores?

How important are your credit scores?
| By Gerri Detweiler,

You can as a mysterious, abstract number, but your credit scores dictate your financial situation.

"Is your credit score how important?"

Money Conference in Las Vegas was posed this question to me recently, when I stood on the stage, after delivering a presentation to optimize your credit card to a group of about 500 women for the annual women. I had only a few moments to summarize the importance of credit scores to the audience and tells them that they can save thousands of dollars annually with a strong credit score. With more time and preparation, however, this is the answer I would have given:

Low credit scores consumers money costs; in some cases hundreds or thousands of dollars.

"A lower credit score a borrower to pay more than $5,000 for a $20,000, 60-month auto loan, that may cause", warns Barrett Burns, CEO of VantageScore solutions. But most people don't know that. "After our joint survey in partnership with Consumer Federation of America, this important fact were almost 80 percent of those surveyed unaware." The two organizations have created a credit, scoring-quiz consumers can use to test their knowledge.

"A good credit score a person thousands of dollars over the lifetime of a loan or a mortgage can to secure support at a lower interest rate save", Antony SPRAUVE, Director Public declared relations for MyFICO. He points to a calculator on the MyFICO site, updated information about average interest rates on various types of loans by credit score.

Using this calculator, for example, the average monthly payment on a 30-year fixed-rate mortgage is $250,000 $1.077 for anyone with a FICO credit score of 760. However, for someone with a credit score of 680-699, the payment is $1,133. This difference adds up to more than 30 years, to more than $20,000!

But the money you can save with a good credit rating is just the beginning.

If you monitor your credit scores, and they start to fall, the valuable information. It can warn you that your finances can begin the head in the wrong direction and be a small course correction in order.

If credit start your credit card, to creep closer to the borders for example you may not realize that a problem exists, since your minimum payments that much every month do not rise. But over time, that increase in debt can be relatively large. Your credit score will reflect, as close to your available credit limit on your card and can indicates that you need to review ways to reduce the debt.

Or a change to one who can your results to show a much bigger problem. If it takes a dive but still substantial a change which way you can your finances, then it show that you are identity theft victims of a credit report error, or worse yet,. If you have your notes do not monitor, may not know that a problem exists until it has destroyed your credit card.

Employers get not credit scores; Get credit reports only. But the information that goes into calculating a credit score is the information in your credit report, so that the two are closely related. Credit reports review almost half of employers for at least some applicants, so stay on the information in your reports can be useful if you are looking for a new job.

And even if you have no job, hunting, to know that your credit in good shape can life something less stressful.

So, Yes, your credit score is important, similar to how to save for retirement or create an investment plan. Even if your credit scores as a result of the economic crisis of the past years have been damaged, not even finished. In the course of time, financial wounds heal can, and hide the scars of your credit card. This is especially true if you are a proactive monitoring of your credit card and maintain good credit references reordering your credit card goes forwards. You can monitor free of charge once a year your credit information agencies from each of the three major credit - reporting through

As my colleague Adam Levin says like, your credit report should be a CV, no criminal record. And writer Donna Freedman (@DLFreedman) in a recent financial chat tweeted: "a credit score is a useful tool. It is not a religion."

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