Getting Your Credit Score From Good to Great!
A 2017 LearnVest survey analyzed 1,000 respondents’ answers regarding their willingness to discuss personal finances. Nearly 70 percent of participants said they would rather disclose their weight to their friends than their credit score. A significant portion of those people already had Fair to Good credit. But there are many benefits to be gained by working towards achieving Excellent credit – not the least of which is getting to keep one’s weight a secret.
The most obvious benefit is also the one with the greatest financial impact: better credit terms. The savings that can be achieved from obtaining a lower interest rate do not stop once a credit score is Fair or even Good. For a 60-month, $25,000 auto loan, a credit score jump from fair to excellent results in a $4,500 savings over the course of the loan. For a 30-year, $222,000 fixed mortgage (the average mortgage in the U.S.), the same credit score jump could yield a $28,000 savings: enough to pay for the car.
Increased safety net
Not only does improving a credit score from Good to Excellent work to improve one’s financial condition, but it also works as preventative care. A credit score can be thought of as a cable-stayed bridge: The higher a person’s credit score, the more safety cables they have holding the bridge in place. If they have an Excellent credit score, it does not matter if a few of those cables break due to missed payments or adverse events. The bridge will remain strong, and they will still have access to the loans and credit they need.
Better personal and professional life
The effects of increasing a credit score are far-reaching, affecting even chances of employment and dating success. In fact, 38 percent of respondents to a recent Bankrate survey indicated that knowing their date’s credit score would impact their level of interest in dating them. A greater percentage – 47 percent – of employers conduct credit checks on job applicants. Among the applicants with damaged credit histories, one in seven is informed that they did not get the job due to their credit. For those who have repaired their credit to Good, pushing for Excellent may increase chances of finding employment.
Better score everywhere
Finally, getting the bump from good to great ensures a person actually has a decent credit score – no matter which provider a lender uses to check it. John Ganotis, founder of Credit Card Insider, explains, “Even under the FICO brand, there are several different models used for different purposes, like for considering a mortgage application versus a credit card application.” Credit.com estimates that there are more than 50 scores for FICO alone.
It gets worse. A little more than a decade ago, the three major credit bureaus started VantageScore. Applicants for a loan cannot decide which credit score the issuing institution will use. While they may have a great FICO credit score, if the institution uses one of the three types of VantageScore scores, it may be significantly less, resulting in rejection or a higher interest rate. Pushing for an excellent credit score can help ensure that a person’s credit score is great regardless of the source of the lending institution’s credit score.
Best boost anywhere
One of the best ways to get an instant FICO credit score bump for those who have already paid off their debt and taken steps to obtain Good credit is through the use of “credit piggybacking.” In this unique process, a person is added as an Authorized User to a credit card with a low balance, long credit history and high credit limit. Due to the large increase in usage-to-limit ratio, participants experience a huge FICO score leap in under 60 days – guaranteed. For more information on how to reap the benefits of an Excellent credit score, contact BoostMyScore today.