Benefits of a Good Credit Rating

by / Friday, 24 November 2017 / Published in Credit Rating

Surviving with bad credit is not at all cheap or easy. Having a good credit will not just help you to save money but also make life much easier. In this article we let you know more about how you can maintain your good credit and the various benefits that you can enjoy by having a good credit rating.

Avail Low Interest Rates On Loans And Credit Cards

When you apply for a loan or a credit card, it is the interest rate that is one of the major costs that you pay for borrowing money. The interest rates charged to you is directly tied to what your present credit score is. If you have a favorable credit rating you will be eligible for the best interest rates and pay low finance charges. So, the lesser the interest rates are, the more you will have to spend for other expenses including repaying the balance.

Better Chances For Loan And Credit Card Approvals

You are likely to get turned down when applying for a loan or new credit card if you have an unstable credit history. However, having an excellent credit score may not be always helpful in obtaining approval. There are several other factors that lenders may consider such as your monthly income and debts. Having a good credit rating will increase your chances of approval and you can apply for a new loan or credit card with confidence.

Opportunity To Negotiate

Having a good credit rating will give you the opportunity to negotiate with the lender and credit card issuer for a lower interest rate. You could refer about the great deals that are being offered to you by other companies based on your good credit score. But if you do not have a good credit rating, creditor will be less interested to budge on the loan terms and you will not have the freedom to shop around.

Receive Approval For Higher Limits

The amount of cash you receive upon approval is typically based on your credit score as well as your monthly income. When you have a good credit rating it will be easy for the lenders to verify that you are a responsible borrower and repay back on time confirm. Therefore, they will be more willing to offer you higher limits. Even if you have bad credit score, you can still qualify for loan and credit cards, but the amount offered to you will be limited.

Easy Approval For Rental Houses And Apartments

Today, more and more landlord checks the credit score of tenants ahead of making any sort of agreement. They will check for bad credit score and if it was caused due to previous eviction or outstanding rental balance. If so, then it will decrease your chances of getting a rented apartment. While, having a good credit score will save you from the hassle of finding a landlord who will overlook your credit score.

Avail Better Car Insurance Rates

Auto insurance companies may use a bad credit score against you. But when you have a good credit score, you will have to pay less for insurance compared to applicants who have lower credit scores.

Avoid Security Deposit On Phone Contract And Utilities

Another benefit of a good credit rating is that the cell phone provider will provide you contract without any security deposit. You can also get huge discounts on any contract deals. But if you have a bad credit score you will have to choose pay-as-you-go plans that are more expensive. Similarly, you can also avoid security deposit whenever you establish any utility services in your name or transfer your service to another location.

There are several other benefits of a good credit rating. Thus, it is important that you maintain your credit status and avoid mistakes that will lower it. You will have to work very hard to turn your credit score from bad to good. So, if you never wish to see your credit score deteriorate, try to keep doing what it takes to maintain a good score rating.