WHY YOU NEED TO KNOW YOUR CREDIT SCORE:
The three major credit reporting agencies are Experian, TransUnion and Equifax.
Your credit report is a snapshot of your personal credit history. It is one of the principal tools lenders use to determine whether or not to extend you credit.
Your credit score is like a report card of your financial record, and like a grade on a report card, your credit score can improve or worsen during each scoring period (every 30 days). Your score indicates the level of risk you represent to lenders in comparison to other consumers.
A good credit score is also essential to receiving lower interest rates and insurance premiums.
WHY GOOD CREDIT MATTERS - Your credit rating is more than just a number.
Housing: Whether in the market to buy a home or making a decision to lease, credit is important. When purchasing a home, mortgage lenders want to know that you will not default on your loan. Landlords consider the rental lease as a loan and want to know that you will pay back this loan.
Vehicle Purchases: Unless you plan to purchase a car with cash, you will need to secure a car loan. Your credit score not only affects whether or not you qualify for the loan, but also the amount and interest rate of the loan. Good credit will allow for larger loans with lower interest rates.
Employment: Many employers are now conducting credit checks as part of the hiring process. If you have not shown financial responsibility, a prospective employer might be hesitant to hire you. The employer may feel your level of debt is too high for the salary offered. In addition, if you are not responsible with your finances, will you be responsible with your job?
Entrepreneurship: Have you ever dreamed of owning your own business? Most business startups require a large amount of cash that you may not have available. In order to secure a small business loan, you will need to have good credit to qualify for the loan.
Utilities: Most utility services including cable, telephone, water, and cell phone will check your credit score. Even your electric company contends that you are borrowing one month of electric service and wants to ensure that you will pay your bills.
