What are the advantages of a good credit score? MSUFCU Chief Marketing Officer Deidre Davis discusses ways a healthy score can improve your financial life.
A credit score is a three-digit number usually ranging from 300 to 850 that is used by lenders to determine how likely you are to pay back a loan on time. In general, the higher the score, the more favorable loan rates you may receive.
Lenders use credit scores to make decisions such as whether to offer you a mortgage, credit card, auto loan, or other credit products. Scores are also used to determine the interest rate you receive on a loan or credit card and can be used to set the credit limit. Landlords and insurers also use credit scores to determine your reliability as a possible tenant and what insurance rates you may be offered.
Because lenders, landlords, insurance agents, and others can review your credit score, a good score can make it easier to rent an apartment, get better insurance rates, and receive lower interest rates on loans and credit cards.
For larger purchases, such as a car or a home, having a good credit score will help you qualify for better loan terms, saving you money.
You may qualify for the best rewards credit cards that come with VIP perks like concert ticket presales, exclusive events, or luxury concierge services.
Having a good credit score also demonstrates you’re a trustworthy borrower. This is helpful when you want to refinance existing debt, take out a personal loan, or upgrade to a better credit card with your current issuer.
And, when you pay less interest, you can apply those savings toward your financial goals such as a down payment on a new home or a vacation.
Keep practicing responsible credit habits that helped you earn your good credit score in the first place. These include paying bills on time, keeping your balances low, and not using more than 30 percent of your total available credit. Also, don’t close credit accounts you no longer use even if they are paid off — they are proof of a long and responsible credit history.
MSUFCU provides free financial education on topics including understanding credit. Many members also receive access to their credit scores on our mobile app and in Computerline, the Credit Union’s online service, for free. In addition, our knowledgeable employees are available to help members determine the best credit products for their needs, and we typically offer lower interest rates on credit cards and loans.
We have several specials going on right now, including a 0.50% rate discount on RV, boat, and snowmobile loans; a sweepstakes to win a year’s worth of car payments, up to $6,000; and $500 off mortgage closing costs. You also can receive $250 after opening an MSUFCU checking account, setting up direct deposit, and conducting 10 debit card transactions within 30 days.
This segment is sponsored by MSU Federal Credit Union.
