Good credit is a necessity these days – without it, it’s nearly impossible to get approved for an auto loan, obtain a mortgage, gain capital for a new business venture or access money in the event of an emergency. Your credit history is also used to determine your insurance and lease rates – and it may even affect your ability to get a new job. CREDIT IS NO JOKE!
People / Companies That Use Your Credit
- Creditors – Banks and credit card companies use your credit history to determine approvals and the terms of your account(s)
- Lenders – Lenders base approvals on auto, home, business and personal loans on your credit history. It also helps determine your interest rates.
- Insurers – Most insurance companies use your credit to help determine your insurance rates.
- Employers – Many employers evaluate job applicants by looking at their credit history.
- Courts – Your credit profile also contains criminal records and may be used by the courts.
- Landlords – Before you move into an apartment or rent a home, your credit history may used to evaluate your creditworthiness.
- Cellular Providers – Most cell phone contracts require a review of your credit.
- Utility Companies – Utility providers evaluate your credit report before authorizing service.
Options to Build or Improve Your Credit
If you have poor or limited credit, there are a variety of ways to build your credit history and improve your credit profile. One of the easiest (and most effective) ways is to responsibly use credit cards. There are quite a few options to consider if you have little or no credit history, but before you apply for a new credit card, make sure you’re ready to handle the responsibility of borrowing money. Make sure you can cover at least the minimum payment each month, and your bills need to be paid on-time – every time! If you fall behind or make just one mistake, it can negatively affect you for 7 years.
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