Here Are the Benefits You Can Get With a Good Credit Score
Thursday, January 31, 2019, 6:00 PM | Leave Comment
Many people are aware that a good credit card history is essential, but they may not know how much of their lives are influenced by their credit scores.
The reality is that good credit provides a range of benefits, including some that people are not familiar with.
Surviving with bad credit may be possible but it is not cheap and it is not always easy.
A good credit score is worth establishing because it eases a person’s financial life and saves money.
There are several reasons to maintain good credit along with the benefits of a good credit score.
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Better Car Insurance Rates
Applying for car insurance is one of the essential areas of life that are affected by the quality of credit a person has. While the basis of an individual’s credit history cannot result in a company turning them down, if a person has a good credit he or she is more likely to be offered affordable premiums. Insurance providers typically believe that poor credit leads to filing more claims. Regardless of whether this is true, having bad credit means paying more for insurance.
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Buying Homes and Renting Apartments
A good credit score is beneficial when someone is searching for a home to own or an apartment to rent. Future homeowners and renters who have good credit experience with higher approval rates based on Lending Bee money lender Singapore for mortgage and rental applications. Additionally, those who have good credit and want to buy a house are likely to receive better mortgage interest rates.
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Increasing Approval for Mortgage and Rental Applications
Landlords want to be assured that tenants will be able to pay rent on time. This is why many rental companies and landlords carry out credit checks when people file their applications. Good credit increases the chances of being approved to buy a home or rent an apartment as well as providing a wider range of options to top-tier candidates.
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Better Mortgage Interest Rates
Good credit also increases the prospects of better interest rates on mortgages. Since mortgages are usually large loans, even a small difference in the rate is enough to yield significant savings over the duration of the loan.
Additionally, mortgage applicants who have good credit are attractive prospects for lenders. Banks prefer to lend to people who will be able to make on-time, continued payments for the term of the loan. Good credit, lower-risk candidates are viewed more favorably and are offered the best deals available.
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Getting a Job
Having good credit can make it easier to get a job. When hiring, companies focus on bringing in the right people. This can be partly determined by looking at the candidate’s credit. Although the candidate’s permission is required, several employers perform credit checks prior to sending offer letters. If an employer finds out that a candidate has a history of late payments or declared bankruptcy, this may indicate that the person is not responsible and not an ideal fit for the position.
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Loans and Credit Cards
Good credit benefits extend beyond buying and renting property. Good credit also increases the chance of boosting bargaining power, higher credit card limits and loan approval. Like with getting a job and renting, a favorable credit score increases a person’s chances for loan and credit card approval.
If a person is applying for a loan or credit card, their credit card score will be a major factor that the lender looks at when considering whether or not to approve them.
Applicants with no credit or bad credit scores are regarded as high-risk borrowers, which means they are less likely to be approved for a credit card or loan. On the other hand, applicants who have good credit scores are deemed to be low-risk and more favorable, which increases approval chances.
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Higher Credit Limits
Although a good credit score increases the chances of being approved for a loan or credit card, there are further benefits. Good credit scores can also help people get approved for larger loans, higher credit limits and other perks.
Borrowers who have good credit scores are rewarded through access to more funds because lenders are confident that they the borrowers will be able to repay their debts. Banks also offer more incentives such as reward points, lower interest rates and cash-back programs to borrowers who have food credit.
Both the lender and borrower benefits as the lender profits from the payback, and interest while the borrower enjoys various perks and their credit score improves with timely payments.
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Better Interest Rates
Better credit scores can also result in better interest rates on loans. With better interest rates, less money will be spent on paying off the loan along with lower monthly payments. A lower interest makes it easier to manage a person’s debt and further increases their credit.
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Boosting Negotiating Power
Good credit gives a person more negotiating power in terms of setting financing or loan terms. A person who has good credit is regarded as an asset that can yield guaranteed returns. People who have good credit and are looking for loans will be more attractive to lenders. Low-risk borrowers can use their value to negotiate for benefits such as higher credit lines, favorable repayment plans and better interest rates.
