The Importance of Your Credit Score

/

Why is your Credit Score important?

1. Your credit score can help you when you borrow money.

At some point, chances are that you will need to borrow money. If you want to buy a house, you will almost definitely have to take out a mortgage. Many people also borrow in order to buy a car.

A good credit score can save you thousands of dollars over the life of a loan. For example, you may get a better mortgage interest rate with a high credit score than you would with a lower score.

2. Your credit score can impact your insurance premiums.

While some states prevent insurers from using your credit score for setting insurance premiums, many states do allow it. And with a lower score, you could end up paying more each month for coverage.

However, you could pay hundreds of dollars less in insurance premiums over your lifetime by improving your creditworthiness and positively impacting your credit score.

3. You may qualify for better terms when you sign up for cable or Internet.

Many Internet, TV, and cell phone service providers now check your credit before they set you up with service. In some cases, if your credit is poor enough, you might be denied an account.

Even if you aren’t denied service, you might have to pay a security deposit or pay some part of your service up front.

4. Access to better financial deals.

When you have good credit, you have access to better financial deals and opportunities. You may be able to refinance your home to a lower interest rate; you might have access to better rewards credit cards with lower interest rates; and you might even be offered checking accounts, investment accounts, and credit cards with signing bonuses.

Here are the best websites and apps to check your credit score for free.

1. Credit Karma

2. Credit Sesame

3. Wallet Hub

3. LendingTree

5. Nerd Wallet