5 Important Benefits of Good Credit

Have you finally brought your credit score up after years of trying?

Wondering exactly what you can do with a great credit score?

If it’s taken you a long time to build up your credit, you may be wondering if it was all worth it or not. Luckily, you’ll be happy to learn that having a great credit score comes with a lot of advantages and can make a lot of things easier for you than ever before.

Below we’ll give you an overview of the 5 most important benefits of good credit.

1. Boost Your Negotiating Power

One of the biggest ways that having a high credit score can help you is that it can give you more negotiating power with banks, credit unions, and lenders.

Having a great credit score makes you seem very low risk, and this can work to your advantage in various ways. As a low-risk borrower, you’ll have a lot more power when it comes time to look for additional loans and credit.

When it comes to negotiating the terms for loans, credit, or financing, you’ll have a lot more say when it comes to setting terms and you’ll find that you’re able to get better deals, simply because you have good credit.

2. Improve Interest Rates

As a result of your improved negotiating power, you’ll be more likely to get lower interest rates on loans and financing. With lower interest rates, you’ll pay a lot less overall with any new loan or mortgage you get approved for.

When banks set interest rates on loans, they’ll take credit scores of the borrower into account. For example, when you take out a mortgage you’ll likely be able to get lower interest rates.

With great credit, you’ll be able to attract the best lenders and you’ll be able to get the best interest rates. This can be a great help since interest can add up a lot over time.

3. Get Approved More Easily

Whether you’re applying for an online personal loan or you’re trying to get approved for rental and mortgage applications, lenders will be much more likely to see you as a reliable borrower when you have good credit. You’ll get approved more easily for any kind of credit, loans, or financing that you apply for.

Additionally, while you’ll get approved for credit cards more easily, you’ll also get access to better credit cards than ever before. Some credit cards are available only to people with excellent credit. However, make sure to check out the CardGuru reviews for any card you’re considering before you apply.

4. Reduce Down Payment Amounts

If you’re looking for a new apartment, booking a vacation rental, buying a car, or making another type of big purchase, you may expect that you’ll have to make a large down payment to get started. However, if you have good credit that may not be the case.

When you have a good credit score, you’ll often find that you’re able to pay less on your down payment than what you otherwise would have to. In some cases, you may not have to pay a security deposit at all.

5. Get Better Car Insurance Rates

Believe it or not, your credit score can have a big effect on your insurance premiums as well. Car insurance companies tend to check the credit scores of anybody they cover when they apply, and they believe that people with low credit scores will be more prone to accidents.

As a result, if you have good credit you may find that you’re able to get lower insurance premiums than what you were able to get previously.

Maintaining the Benefits of Good Credit

While there are many other benefits of good credit, the above list covers some of the main advantages you can expect.

Remember that your credit score can go down if you’re not careful, so make sure that you’re responsible with any new credit cards or loans you get approved for. If you continue to be wise with your finances, you may continue to experience these benefits for a long time to come.

Want to make sure you keep your credit score in check? Click here to learn about the 5 things you’ll want to avoid to keep your credit in great shape.