But it just isn’t so.
While I’m definitely on the anti-debt (except for the mortgage) bandwagon I think it’s completely ridiculous to not care about your credit score.
Maybe the original authors of these type of posts simply aren’t aware of all the ways your credit score is used or maybe their articles are an attempt to make them feel better about having a bad credit score, regardless of the reason you should care.
Here’s why your credit score matters.
A Bad Credit Score Will Make Your Home & Auto Insurance Crazy High
Like, crazy, crazy high!
Before I journeyed into self-employment two years ago I was a personal lines insurance agents. I would never have believed the difference a credit score could make in an insurance premium until I witnessed it firsthand.
For instance, there was a time where I quoted someone’s home insurance and the premium came back at $800 for a year. She didn’t take the quote then but instead called back six months later wanting to take it. I had to requote the policy which came back around $2,000 because her great credit score had dropped by a hundred points!
Talk about an uncomfortable phone call.
And that’s thing, I can tell you as an ex-insurance agent that credit scores will be the last reason we tell you why your premium went up. Why? Because it’s uncomfortable and it’s embarrassing for the client.
Your insurance agent might not be telling you that your bad credit score is why you’re paying ridiculous amounts of money but if you have a bad score, chances are it’s the culprit.
You Need a Good Credit Score to Rent or Buy a Home
You know that you need a good credit score in order to get a decent interest rate on a mortgage but you also need a good credit score to get into a good rental.
In competitive rental markets detailed background reports are going to be pulled on potential tenants. If you have competition and the main difference between you and your competition is a credit score, guess who’s going to get the rental? The person with the higher number.
In Some Cases, Employment
While potential employers can’t pull a credit score they can pull a version of your credit report. (With your permission, of course.) And once again, if your credit report is pulled and there are all kinds of blemishes on it, guess who won’t be getting the job? You.
While you might think that your credit score doesn’t matter, especially if you never plan to take on any type of loan, it’s just not true. And if you do plan to borrow money at some point in your life then you really need to care about your credit score. Just a one point difference in interest rates can save you thousands of dollars over the life of your loan.
Wanna know your credit score? Here’s how to check it for free.