Having a healthy credit score is a powerful financial tool. For example, when you apply for a credit card, mortgage or loan, the first thing companies will check is your credit score.
It is important that you know that any consumer whose credit score exceeds 700 points will obtain lower interest rates. On the other hand, those with scores below 500 points will pay higher interest rates and, in the worst case, their credit could be limited or denied. It is worth mentioning that this valuation is also consulted by some employers, insurance companies, landlords and lenders in order to investigate how responsible you are with your finances. It’s as if it were a cover letter!
That is why before applying for financing or intending to purchase a property, you should request a report so that you know the status of your credit score. This will help you have a clear idea of whether you will qualify for agreeable terms or possible increases in the cost of the loan.
- Pay your bills on time. It is recommended that you pay more than the minimum or the full balance. This will reduce financing charges. Pay attention to the due dates so that you do not miss any payments. Experts recommend using automatic payments to pay on time. Make a payment schedule and make sure you have enough money.
- Be careful with credit cards. This famous piece of plastic has become the most acclaimed invention of all time. It represents a great relief to users and serves as a boost to the economy, but… many use it incorrectly. The key is to never exceed your card limit or spend more than 10% of your net monthly salary on card payments.
- Safety first. Memorize your PIN number and account number. Don’t write them down, don’t share them with anyone and never mention them out loud. Don’t throw shopping receipts in public trash cans either; it is best if you could purchase a paper shredder to destroy bank statements and other financial documents. And if you are unable to acquire one, always remember to tear up these documents before throwing them away.
By following these steps, your score can be an excellent presentation letter for financial institutions. It will speak highly of you and say such extraordinary things that you will get the funding you are looking for. This score will help you get better offers from lenders, lower your interest rate and speed up the application approval process.
