If your credit is bad, you may get denied.
Our society runs on credit.
In order to get a mortgage, unsecured credit card or an installment loan, one needs a credit score to qualify.
Lenders want to make sure they’re dealing with reliable and responsible people.
And credit isn’t just handed over, we all have to prove our creditworthiness.
A credit score is proof positive of that.
For instance, a credit score below 500 will not qualify for an FHA or any type of mortgage.
A credit score between 500 and 580 requires a 10% down payment, and a credit score of 581 or above requires a 3.5% down payment.
As you see, the higher the credit score, the lower the down payment needed.
Even if you’re not looking for a loan to buy a house, your credit rating still has an impact on where you live.
Did you know landlords consider rental agreements a loan?
They’re loaning you a place to live in exchange for a monthly rental payment.
If your credit is bad, you’ll most likely be denied.
But, even if you do get approved, you could be charged a higher security deposit and a higher rent payment than the other tenants for the same living conditions.
Credit, or the lack thereof, contributes to the quality of living.
It even takes credit to get utility services.
Gas, light, cable and phone companies do credit checks before extending service.
Oftentimes, a security deposit is required for those with bad credit with stipulations that if one payment is missed the money is forfeited at the end of the term.
As you see, credit scores provide a gauge for lenders to determine your ability to pay them back. Your credit score tells the story of your current and possibly future financial habits.
Begin to establish good credit today by first ordering copies of your credit reports from Annualcreditreport.com.
Second, clean up any negative accounts with the credit bureaus before applying for a home loan, financing a car, or making an application to a rent.
If you’re interested in fix your own credit, click the link and sign up for our 100PF Academy R.E.I Accelerator Course.
In this course, we’ll show you how to dispute with the credit bureaus inaccurate and incomplete information that’s reporting on your credit file, and then we’ll show you how to build your credit score up to 720.