You never realize just how much you need good until you try to use credit and you don’t have it. There are many things you can’t do these days unless you have credit. That includes things like getting a job and even a place to live. Here are some of the reasons that credit is so important.
Buying a House or Renting an Apartment
Without credit, you’ll have a hard time finding a place to live. Of course, mortgage lenders check your credit before they’ll give you a loan to purchase a house. If you don’t have a score, you could end up with a high interest rate loan. Worse, you could be denied completely. Even landlords check credit before allowing you to sign an apartment lease.
Once you get a home or apartment, will come into play when you get utilities turned on in your name. Most service providers do a credit check before turning on your electricity, gas, water, cable, and other services. If you don’t have credit, you will likely have to pay a high security deposit before you can have services turned on in your name.
Buying a Car
Buying a new car requires credit, too. Auto lenders run a credit check before approving an auto loan application and, like a mortgage loan, you can be denied if you don’t have credit. Unfortunately, not having good could leave you without the transportation you need.
Getting a Job
Good credit is vital to your career. So many potential employers now check for credit as part of the hiring process. This is especially true in government and financial positions. Negative information in your history could keep you from getting hired. Not only do employers check for credit when they’re hiring new employees, they often do credit checks before giving some employees a promotion or a raise.
For Lower Insurance Rates
If you want the lowest insurance rates, you’ll have to hav credit. Insurance companies now check credit in the underwriting process. They say that people with poor histories have greater chances of defaulting. So, if you don’t have credit, you’ll likely find yourself with a higher interest rate.
Starting Your Own Business
Thinking about starting your own business? Your credit will be a factor in getting the small business financing you need to get your business up and running. If you have bad credit, you may be denied for small business loans.
You can get around having good, but it will make life tougher. Since good is required in so many aspects of life, it’s better to work in repairing your credit than to go without the benefits of having score.