The Different Ways Your Credit Score Can Impact You

Your credit score is at the top of the list of the things that your potential lender wants to see when you ask him for a loan

. If it is not high enough he may refuse you the loan outright. Alternatively, he may give you the loan, but at onerous interest rates or conditions.

Your credit score really comes into play when buying a home. When you take out a mortgage, your credit score may determine whether you end up paying $800 a month for your mortgage or $1300 a month. Over the span of a lifetime, a poor credit score can cost you hundreds of thousands of dollars. That's why it is so important to keep track of your credit score.

There are three main agencies who develop, maintain, and distribute credit reports. And you can choose to get your credit report from one or all three. Unfortunately, your credit score does not automatically come along with your credit report. To get your credit score, you have to request it specifically from the company and you will most likely have to pay a fee as well.

Why the fee? Simple. It is a profit center for the credit reporting agencies. They need a way to make more money, and charging a fee for the credit report is easy money. When you send for you credit score, request it from all three agencies. The reason is that all three calculate the score a bit differently.

Requesting your credit score from one of the credit reporting companies will not cost you a lot. By law, they can only charge you a so called reasonable amount. But, if your want, there is one way to avoid the charge completely. And that is to get it directly from the lender from whom you are trying to get a loan. For instance, as mentioned above, when you apply for a loan, your lender will ask the credit reporting agency for your credit report and your credit score. This means that when you return to find out whether you have the loan or not, he knows your credit score. Simply ask him what your score is. Most will give it to you with no problem.

The average person would, no doubt, be astonished at just how big of an effect that their credit score has on their lives. We all know, by now, of course that it affects loan interest rates. But what you may not know is that it also affects your home and auto insurance rates. Your score affects whether you will have to put down a deposit when you sign up for a home utility such as gas or electrical. In short, it impacts, so many things that you would be foolish to ignore the power that it wields.

The Different Ways Your Credit Score Can Impact You

By: Susanna Berlatsky

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