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Benefits of having a good credit score.

March 18, 2020

Looking after your credit score is extremely important. Your credit score is tied to you for life, and companies will refer to your score to make decisions that can have significant impacts on you and your family. From paying for your utilities to getting a mortgage for your dream house, your credit score will play a role in several instances. The higher your score, the more likely you are to be accepted for credit. With a low score, you may struggle to be accepted by companies.

  • Lower interest rates on credit cards, loans, car finance and mortgages. Interest is the cost of borrowing. You will pay interest in addition to your repayment amount and fees, such as arrangement fees. Lower interest rates may be offered to you as companies will consider you to be more trustworthy.
  • Better chance for credit cards, loans, car finance and mortgage approval.
    You will appear to be more reliable to companies, leading you to have an increased chance of approval when applying for credit. You will have a wider variety of credit options available to you, meaning you can apply with confidence.
  • Approval for higher limits.
    Not only will your approval rate for acceptance increase, but your credit limits will too as companies will only lend large amounts to you if they believe that you can handle it.
  • Easier to rent from landlords.
    Landlords do checks to assess your history of credit as they need to be confident you keep up with your payments before agreeing to rent their property to you. In particular, falling behind with previous rent payments will stand out and influence their decision. The evidence of your regular payments helps the landlord to make an informed presumption, which can lead to an approved tenancy agreement.
  • Better car insurance rates.
    Numerous factors help to calculate your car insurance rate. Your age, occupation, experience, where you live, the car you drive and how you use it, your car’s security, your driving history and no-claims bonus, your excess, and the type of cover you buy. In addition to this is your credit history if you pay by monthly installments. Payment history, outstanding debt, and other factors from your credit report can affect your insurance premium.
  • Paying utilities.
    You usually pay for gas and electricity in arrears. Until you make your payment, the provider essentially loans you the use of utilities. If your credit history shows a series of missed payments, they may refrain from letting you use their services due to fear of late payments, or put you on payment metres.
  • Phone contract with no deposit.
    If you have little or no credit while taking out a new phone contract, your service provider may require a security deposit; once you have established sufficient payment history, you will get your deposit back. Having a good credit score will prevent companies from requiring a security deposit as they have assessed your reliability.
  • Your future goals.
    A lot of people depend on their credit scores to assist with significant life events, whether it’s to help with the costs of a new baby or to fund their dream holiday. For many, knowing they have a good credit score gives peace of mind that they have relatively easy access to necessary funds if they are ever needed.
  • Your social score.
    Companies also use social media to get an indication of your financial stability. When you open a Notty account, you will gain access to your social, fraud and loan score. Get your Notty account today: https://www.notty.co.uk/