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Home Articles 5 Shocking Ways Your Credit Score Can Affect Your Life

5 Shocking Ways Your Credit Score Can Affect Your Life

IndianMoney.com Research Team | Posted On Thursday, November 21,2019, 02:53 PM

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5 Shocking Ways Your Credit Score Can Affect Your Life

 

 

There is numerous myth and rumors about credit score. Unfortunately, some credit score myths are true. A credit score has the ability to severely impact your financial life and your career.

Your credit score is an indicator of your financial habits. Banks and financial institutions check your credit history to understand how well you manage your money. Here are some of the ways a credit score restrict your ability or help you qualify for loans.

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5 Shocking Ways Your Credit Score Can Affect Your Life

Importance of credit score while buying a home:

Before you book your dream home, don’t forget to check the recent changes to your credit score. Lenders usually prefer an excellent credit score which lies in the range of 750-900 points. Banks follow a strict verification process while sanctioning a home loan. Credit score verification plays an important role in helping you qualify for the best loan terms and interest rates on home loans. Your credit score indicates how responsible you are to manage debt and how efficiently you repay your loan EMIs. Lenders can predict whether or not you will remain dedicated to paying your home loan. With a low credit score, you may have to end up paying a higher interest rate on your home loan. 

See Also: Credit Score India

How credit score helps in getting a new Credit Card:

Wondering why your bank has rejected your credit card application. Well, we suggest you have a look at your credit score. Credit cards with amazing rewards and benefits are often sanctioned for individuals who have an excellent credit score. With a good credit score, you can avail attractive bonuses and rewards like free movie passes, waiver on fuel, introductory bonuses, rewards and cash backs on shopping and airport lounge access.

Individuals with an average credit score must work towards improving the credit score and then apply for a credit card.  Improving credit score takes time. So make sure to make timely repayment of your credit card bills and loan EMIs in the meantime. Also, do not apply for multiple credit cards at once as this may give the impression that you are credit hungry.

A good credit score helps you avail a car loan-:

Have you applied for a car loan? If not, wait to check your credit score and know your eligibility. Just like any other loan, you need to have a certain credit score to qualify for a car loan. a good credit score can help you avail loan from the financial institution you prefer. However, a low credit score with slim your chances of availing loans at a better interest rate and loan terms.

Banks will evaluate you based on your credit score and they may reject your car loan application if they find you have a low credit score.

See Also: Check Credit Score Online

Fund your business conveniently with a good credit score:

Any business needs funds to expand and grow. As such credit is the lifeline of new as well as established businesses. If you are starting a new venture or you need credit to invest in a new project then a business loan can help you avail the required funds. A good credit score can allow you to get the capital back-up at the best interest rate and loan terms. But before applying for any loan make sure you have a good credit score. Banks usually give loans to businesses that have a steady income and have a good flow of cash. However, banks may reject a loan if they are not satisfied with your credit history or credit score. While a good credit score helps you to avail funds readily, a bad credit score may lead you to financial trouble and inconvenience in securing a loan.

See Also: Free Credit Score

Credit score affects your ability to secure a new job:

Applying for a new job? Do you have a good credit score?

Most of the times employers go through the credit ratings of an applicant before offering them jobs. A good credit score can positively impact your chances of securing a job.  You may take an extra step and update your credit score along with your resume to ensure you are not rejected because of this.

Companies reach out to credit institutions and collect credit reports of applicants. A good credit score instills faith in your employer that you are responsible and can manage your finances efficiently. On the other hand, a low credit score may imply that you are not a creditworthy person and thus make you seem irresponsible and negligent to the hiring manager.

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