Why an Excellent Credit Score Matters

“A high credit score means that you will most likely qualify for the lowest interest rates and fees for new loans and lines of credit,” McClary says. And if you're applying for a mortgage, you could save upwards of 1% in interest.

Having a high credit rating can be a money saver. You may recall that the maximum rate on a 30-year, fixed-rate, $300,000 mortgage is 4.919% with a FICO score of 760. So, the total of principal and interest due each month is $1,596.

Find out how much you would have to pay every month if your FICO score was 630. The current rate on your mortgage is 6.508%, with a monthly payment of $1,898. What will the year-two difference be in terms of payments?

The cost difference between us is $3,624 per year. You've spent an extra $36,240 after ten years. The gap between a poor performance and a stellar one is astronomical.

The best credit cards will be available to you, and in some states, you may even be able to get insurance at a reduced rate.

A high credit score is advantageous because it increases your chances of being approved for a loan at a favorable interest rate in times of financial crisis, such as when you need to make an expensive repair to your home.
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