What are the benefits of a good credit rating? Deidre Davis, MSUFCU’s Director of Marketing, explains how 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 the likelihood of you repaying a loan on time. In general, the higher the score, the more favorable loan rates you can qualify for.
Lenders use credit scores to make decisions such as offering mortgages, credit cards, auto loans, 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 potential tenant and the insurance rates that may be offered to you.
Since lenders, landlords, insurance agents, and others can look at your credit score, a good score can make it easier to rent an apartment, get better insurance rates, and qualify for lower rates. lower interest on loans and credit cards.
For larger purchases, like a car or a house, having a good credit score will help you qualify for better loan terms, which will save you money.
You may qualify for the best credit cards that offer VIP perks like concert ticket presales, exclusive events, or luxury concierge services.
Having a good credit score also demonstrates that you are a trustworthy borrower. This is useful 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 to your financial goals, like a down payment on a new home or a vacation.
Continue to adopt the responsible credit habits that helped you get your good credit score in the first place. These include paying bills on time, keeping your balances low, and not using more than 30% of your total available credit. Also, don’t close credit accounts you no longer use, even if they’re paid off — they’re proof of a long and responsible credit history.
MSUFCU offers free financial education on topics such as understanding credit. Many members also have free access to their credit scores on our mobile app and on Computerline, the Credit Union‘s online service. Plus, our knowledgeable employees are available to help members determine the best credit products for their needs, and we generally offer lower interest rates on credit cards and loans.
We have several promotions running right now, including a 0.50% discount on RVs, boats, and snowmobile loans; a raffle to win a year’s worth of car payments, up to $6,000; and $500 off mortgage closing costs. You can also receive $250 after you open an MSUFCU checking account, set up direct deposit, and complete 10 debit card transactions within 30 days.
This segment is sponsored by MSU Federal Credit Union.