Benefits of having good credit
The benefits of good credit- Why do you NEED good credit?: Buy a home, rent an apt or house, purchase a car, Make large purchases such as furniture or appliances, get a job, borrow money, Get a credit card
Credit scores and what they mean
800 and Higher (Excellent) With a credit score in this range no lender will ever disapprove your loan application. Additionally, the APR (Annual Percentage Rate) on your credit cards will be the lowest possible. You’ll be treated as royalty. Achieving this excellent credit rating not only requires financial knowledge and discipline and, but also a good credit history. Generally speaking, to achieve this excellent rating you must also use a substantial amount of credit on an ongoing monthly basis and always repay it ahead of time.
700 – 799 (Very Good) 27% of the United States population belongs to this credit score range. With this credit score range you will enjoy good rates and approved for nearly any type of credit loan or personal loan, whether unsecured or secured.
680 – 699 (Good) This range is the average credit score. In this range approvals are practically guaranteed but the interest rates might be marginally higher. If you’re thinking about a long term loan such as a mortgage, try working to increase your credit score higher than 720 and you will be rewarded for your efforts – your long term savings will be noticeable.
620 -679 (OK or Fair) Depending on what kind of loan or credit you are applying for and your credit history, you might find that the rates you are quoted aren’t best. That doesn’t mean that you won’t be approved but, certain restrictions will apply to the loan’s terms.
580 – 619 (Poor) With a poor credit rating you can still get an unsecured personal loan and even a mortgage, but, the terms and interest rates won’t be very appealing. You’ll be required to pay more over a longer period of time because of the high interest rates.
500 – 579 (Bad) With a score in this range you can get a loan but nothing even close to what you expect it to be. Some people with bad credit apply for loans to consolidate debt in search for a fresh start. However, if you decide to do that then proceed cautiously. With a 500 credit score you need to make sure that you don’t default on payments or you’ll be making your situation worse and might head towards bankruptcy, which is not what you want.
499 and Lower (Very Bad) If this is your score range you need serious and professional assistance with how you handle your credit. You’re making too many credit blunders and they will only get worse if you don’t take positive action. If you are thinking of a loan then keep in mind that if you do find a sub-prime lender (which won’t be easy), the rates will be very high and the terms will be very strict. We recommend that you fix your credit and only then move on to applying for a loan.