| Many people don't realize that your credit score is | | | | will usually have a much lower score. If bills are ignored |
| very important. Yeah, you heard correctly, your credit | | | | completely, your credit score will drop dramatically |
| score. It may not necessarily be the most important | | | | over time. In simple terms, your credit score is a |
| thing in your life, but it is certainly vital to your financial | | | | measure of how competent and responsible you are |
| success. Many people ask "Is Your Credit Score That | | | | with your finances and your budget. |
| Important?" Well, no, its not important if you plan on | | | | Having a low credit score will not completely isolate |
| "NOT" getting a loan, having any credit cards, or buying | | | | you from society. It will just make financial decisions a |
| a house with a mortgage. However, many people will | | | | bit harder. Those with low credit scores can still apply |
| apply for, or try to obtain, at least one of these 3 things | | | | for loans and be accepted. The only problem is that |
| and if they have bad credit, it will be much harder to | | | | the interest rate on a loan they receive will be much |
| obtain them. | | | | higher than if they had a better credit score. The same |
| In order to understand the credit score, you have to | | | | applies to mortgage rates and credit cards. Although, if |
| understand what lies behind it. A credit score is not just | | | | the credit score is dreadfully low, they may need a |
| random number that is assigned to you. It is a number | | | | person to co-sign with them. This is all to insure that |
| that is reached after a mathematical formula has been | | | | the bank or credit card distributor does not get |
| used with the information in your credit report. All the | | | | screwed on the deal. A big problem is that the interest |
| information in your credit report will be put into the | | | | rates make it harder for people with a low credit |
| formula and it will produce your credit score. Your | | | | score to pay off, hence, it creates a never ending |
| credit report contains lots of information about previous | | | | cycle of missed payments and lowering credit scores. |
| transactions you have been involved in. Most of these | | | | Thats why it is advised that before you get a loan or |
| transactions are bill payments, and all bills you have | | | | credit card, try improving your credit score. |
| paid, on time, late, or not at all, will be listed clearly in the | | | | If you do find out that you have a low credit score, |
| report, as well as any loans you have, or have not, | | | | concentrate on paying bills on time. If you have credit |
| paid off. | | | | cards, make more then the minimum payments; this will |
| If you pay your bills on time, every time, and have kept | | | | show that you are responsible and it is very likely that |
| up with any loan payments you have, its quite likely | | | | your credit score will raise with time. If any of your bills |
| you have an average or above average credit rating. | | | | have an auto-pay option, get signed up for it right |
| One or two late payments will not drop your credit | | | | away. This will ensure that you pay your bills on time |
| score substantially, so you don't have to worry if you | | | | each and every time. Its not terribly difficult to maintain |
| were a day late with a payment. However, those | | | | an average credit score, you just need some planning |
| people who are consistently late with their payments | | | | and a good ol' fashion budget. |