Why Improve Your Credit Score?

A credit score is one aspect of your financial history that often gets the least amount of attention. However, no matter how boring it may seem to you, it greatly affects your financial freedom, thus you should begin taking your credit score seriously starting today. You can start by determining the present standing of your credit score and the rest will follow through.

Credit Score Checking

To get a credit check, there are many credit reporting agencies that will accommodate you. You can reach out to Equifax, Experian, and Illion. Before checking your credit score involves a lot of procedures and most of the time, it could be a daunting task. Even until today, you still need to wait for a certain period of time or you could pay to accelerate the process. Thanks to a free credit check online, you now have more options and much faster processing time. In fact, you can obtain free credit checks from various websites. Pro tip: get your credit rating check from different agencies to give you a better view of your current financial standing.

How To Determine Good Credit Score?

Once you obtained your credit score, what would be your next step? Basically, you want to assess whether or not you have a good credit score. Thankfully, credit reporting agencies utilize the same band descriptors to find out the status of your credit score. Typically, your credit score is somewhere between excellent, good or weak. Here’s a quick guide to find out your credit score rating:

Experian:

• Excellent – 800-1,000
• Good – 625 – 699
• Weak – 0 – 549

Illion:

• Excellent – 800 – 1,000
• Good – 500 – 699
• Weak – 0 – 299

Equifax:

• Excellent – 833 – 1,200
• Good – 622 – 725
• Weak – 0 – 509

So, how do you measure up? If your score is currently on the lower level of the scale, don’t worry. After all, the initial step to solving a problem is learning how to recognize it. Even individuals with good ratings still need to improve because the higher the score, the greater the benefit.

How To Improve Credit Score?

In order to improve your credit score, you need to start with the basics. Practice good financial habits such as limiting credit card or loan applications, settling bills on time, and repaying all outstanding credit cards or payday loans. You should also track your credit score regularly to see you improve. Examine your credit check since you can pick up ideas on which aspect you need to improve. Take note that having a good credit score will give you a handful of benefits and will make your life even easier. Here are some benefits that you might want to check out:

1. Plenty of power to negotiate

This particular benefit cover different areas and it is extremely helpful. When you have good credit, this means that you can negotiate better than before. Whether it’s for managing a no credit check loan or negotiating terms for your credit cards, it pays to have more negotiating power. You’ve been through tough financial situations and bad loan terms so when you have the capacity to demand for greater deals, you won’t hesitate to use it to your advantage. With this kind of powerful influence, you’ll be more confident to communicate and demand what you think suits your situation. If the financial company you worked with isn’t offering you the terms that you are looking for, having an exceptional credit score will allow you to walk out without any doubt and find new deal from other companies. Feels good, right?

2. Better job opportunities

Though this isn’t as useful as the previous benefit, this one will back you up as you embark on your career. Chances are, as your position in your chosen field ranks up, potential employers will begin to perform credit checks as part of their assessment procedure. This is very important if you are planning to apply for a job that revolves around dealing with finances. Basically, in such a line of work, your employer will entrust the company’s finances to your hand – so they would want to find out how you manage yours. The credit check that would be carried out by your prospective employer will serve as some sort of reference. Generally, a referee is a form of contact you submit to your employer in order to determine if you are qualified for the job. They want to know that you are as reliable and responsible as you claim, and a credit check will offer some insight. Once they find issues about bankruptcy or consistent late default payments, they will deem you like risk and unreliable for the work. They will also worry that your personal financial problems could destroy your job with them. With this, having a top-notch credit score will serve as an extension of your credibility and can offer you an advantage against other applicants.

3. Hassle-free renting

If you are currently residing in the city, you’ll find that you have a lot of competitors when it comes to renting out spaces. There are many people who aren’t homeowners yet and they too, wanted to find the ideal spot that they can temporarily call home. The dream is to live in a space that’s close to work to skip morning traffic, just a short drive from restaurants and stores, and a walking distance from beautiful parks – but it’s not always this easy to look for the perfect place. And in the case that you do, chances are, you are not the only one who wants it. Just like employers and lenders, landlords can also utilize your credit score to find out if you are going to be a trustworthy tenant. With several people fighting to rent a single unit, having a weak credit rating will lower your chances of winning against your fellow renters. A history of late or default payment doesn’t translate to a responsible tenant and even if you have a healthy account balance, you could still lose your chance. This being said, having a favorable credit score is very important when you are looking for a unit to rent. This will give your landlord an impression that you can manage your finances well and pay your rent on time.

4. Great home loan deals

If you are done renting and want to settle in a place that you can call home, then you are ready to buy yourself a new house. However, purchasing residential property costs a lot and you can’t instantly get enough money for it. This is why you need to reach out to your bank and decide to take out a home loan. But, if you have a weak credit score, this simple process could turn into a difficult task. With this, you need to make sure that you have an immaculate credit score before you apply for a home loan since it will back you up during the application procedure. You’ll also have a chance to negotiate better home loan deals with your bank.

5. Affordable utilities

By the time you are reading this, you are probably thinking, “All aspects of my life are truly dependent on my credit score, just great!” That’s why starting now, you should give importance to yours and start revamping it to enjoy the benefits of having a good credit score.

In the case that you are paying utilities on your own, there are utility companies that may examine your credit history. The same way how landlord or bank companies do it, they wanted to make sure that you have the capacity to turn in regular repayment. If you had an issue of late or default payments in the past, they may ask you to make an advance deposit to make up for the risk that they are accepting. If you just moved to your new place, this unnecessary cost is the last thing that you wanted to encounter. This is where the importance of improving your credit score comes in since it will save you from additional financial strain in your life.

If you are on Centrelink payments, you may be interested in applying for a Centrelink loan. You can apply for one at the previous link.

6. Favorable insurance costs

Though you don’t want to think about unfortunate events happening to you, it pays to be ready. This is the reason why insurance companies are established – to aid you during unforeseen life incidents. To achieve peace of mind without breaking your bank, you need to obtain the most affordable insurance deal. As expected, your credit score plays a huge part even in this aspect. People with excellent credit scores have greater chances to obtain an affordable insurance plan. The thing about insurance companies is they calculate risk. Even if they won’t reject you for having a poor credit score, you will be offered an insurance plan with an expensive cost. Improve your credit score and witness how these costs will dramatically decrease.

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Your credit score influences different aspects of your life. Knowing this, you should start improving your financial habits, handle your finances accordingly, and take extra measures to ensure you rebuild your score.