With so many of algorithms and models, credit score becomes quite confusing. It sometimes make you messed up with your credit ratings and a bad credit, without making you realize what you have done. This is also true credit scores don’t get that much attention as they deserve, but yes they do come into consideration when one goes to apply for the loan and realizes what has ruined it all. As credit score is the main medium through which lenders assess a borrower’s risk and means the difference between for not just applying for the loan. It’s important to maintain a good credit score.
Also read: ALL YOU NEED TO KNOW ABOUT CREDIT SCORE
In simple terms, if you are having a bad credit rating you needs to pay high rate of interest while the one who is having a good credit rating needs to pay less rate of interest. Let’s assume, if you are going to buy a house and while settling down the payment part, your credit score would be the one that will play the major role in the process. Having a good credit rating can help you in other situations as well. The situation in which a good credit score will help you are as follows:
• Employment- There are few jobs that require a good credit score like jobs in finance sector. The reason behind a good credit score is that if an individual can’t manage his finance than they might face difficulty managing other people’s credit score.
• Rentals- If you have a bad credit score, then you may be denied for rental opportunities as this signifies you won’t pay the rent for the given opportunity. As your file shows may he you are at a risk of not paying your rents.
• Low rate of insurance- Bad credit can affect you in other areas apart from credit cards and loans. It can affect your insurance rates and cost you hundreds or thousands more than if you have a bad credit score.
Above were the few areas where credit score can affect your life. So it is always advisable to have a good credit ratings.
To maintain a good credit score, it is necessary to come across the range. A good credit score that one should have ranges from 700 to 749. If you are having a goal or likely to have one to have a good credit card plus low interest rates is that you need to have a good credit score i.e. 750. Before thinking of having an excellent credit score you need to be aware of what is the bad credit score and it is 600 or below. In short, we can say a credit score ranges from bad credit score to a good credit score.