Why is Credit Repair Important?Credit repair is important because it can help get you "good credit." Maintaining good credit can make your life a lot easier in a number of ways. Poor credit leads to these problems you want to avoid:
- Poor credit scores. Your credit scores are calculated using your credit report. If your report has errors, you will probably have a lower score than you should.
- Rejected for a loan and mortgage. Lenders rely on your credit score when deciding whether to give you a mortgage or loan. When your credit score is low, your loan application is often rejected. Mortgage and auto lenders are making it even harder to get a new loan or re-finance, so a better credit score is even more important.
- Higher interest rates. Even if you do qualify for loans and mortgages, the interest rate you pay is important. This rate is the amount of money you pay to borrow from the lender. The lower your credit score, the higher your interest rate (because the lender thinks you are a higher risk). Repairing your credit and improving your credit scores could save you tens of thousands of dollars over the life of your loan.
- Higher insurance premiums. Many insurance providers check your credit report and scores. A low credit score is often viewed as a higher risk and can result in higher premiums.
- Lost job opportunities. Many employers perform credit checks before hiring. Companies do this as a way to gauge an applicant's level of responsibility. A bad credit report can make you appear careless or irresponsible. This could lead to you not getting that job you really want.
Posted on June 7, 2013 at 04:56 PM | Permalink