April 7, 2015 Admin | April 7, 2015 Achieving a credit score of 760 can save you thousands of dollars over time. How?
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If you have a credit score of 760 or higher you will get the best offers for loans because you have very little credit risk and people would want to loan you money. If you have a credit score that high you can get better rates on all loans and sometimes get special deals that you pay no interest for a period of time of the loan, a high credit score lowers the interest that you pay on a loan and can save you a large amount of money over the life of the loan. If you pay all your bills on time and have the good score you will likely be doing many other things responsibly and will be seen as a good person in many other aspects such as work or renting something.
Your credit score is basically a measure of how risky you are to a bank or other institution that will lend you money. Interest rates on loans are based on how likely the bank thinks you will pay them back.
If you are less likely to pay them back (lower credit score) they will charge you more. If you are more likely to pay the loan back they will charge you less.
Your credit score takes into account your punctuality of past credit payments, the capacity of credit that you use each month, how long you have been using credit, how many different types of credit you use, and how often you apply for new lines of credit. Achieving a high credit score like 760 means that you have had a line of credit open for several years and that you paid the monthly balances in full and on time. When you do this, loan providers know that the likely hood of you paying them back is very high, so they give you a break on the rate of interest that they loan out money to you. Having a loan with a lower interest rate means that you are paying less in interest over the life of the loan and are therefore saving money as well.
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By taking on the appropriate amount of debt and making regular payments over time, an individual earns a high credit score. (This pertains to bill payments and loans). Financial institutions offer lower interest rates and may even negotiate interest rates, due to low probability of loan default. A lower interest rate means the individual will not pay as much over the life of the loan and money is saved.