We cannot stress how important it is for you to know your credit score before applying for financial products. It will give you an idea of what to expect when dealing with financial institutions, and there could also be further-reaching effects.
How can your credit score affect you?
1. You may be declined for credit cards
Credit cards can help you save money – if used correctly – and earn you plenty of rewards. From movies and groceries to dining and travelling — credit cards can come in handy.
However, a bad credit score may make it difficult for you to get approved for a credit card. After all, there’s no telling if you’ll actually be able to pay off your bill every month if you have a history of missed payments.
2. You may not be able to finance a car or a house
Just like applying for a credit card, loan applications will be affected by a weak credit score too. Even if your loan gets approved, a low credit score may result in higher interest rates as banks lack the confidence that you will be able to service the loan.
Higher interest rates mean higher monthly instalments, which could have been avoided if you keep a good credit score.
3. It may affect potential job opportunities.
You probably never thought about your credit score when applying for a job – because who does anyway? Potential employers may check on your financial health if you’re applying for a high-level position or a position that involves finances. If it is less than satisfactory, they may decide to offer the job to someone else.
Employers want someone who is consistent and reliable, and your poor credit score may portray you to be otherwise.