Why Good Credit MattersPosted on January 4, 2010

We are becoming increasingly dependent on using credit to make purchases. These days, having good credit is not only important when you want to obtain credit cards or apply for loans, it is also important when you apply for new services like phone and cable.

Home
When is comes to where you live, having good credit is very important. Mortgage lenders want to know that you won’t default on your mortgage. If you don’t have a good credit rating, the lender will probably consider it risky to give you a mortgage loan. This could result in paying a higher interest rate or even worse, denial of the loan.

Even if you are not on the market for a new home, your credit is still important when you rent. Landlords consider your lease as a loan. You are being loaned a place to live and the landlord wants to ensure that you will pay back this loan. If you don’t have good credit, you may be denied an apartment lease.

Transportation
Unless you have the cash to purchase a car, you’ll have to get a loan. Your credit not only affects whether or not you qualify for a loan, but also the amount and interest rate of the loan. Generally, loan applicants with good credit qualify for larger loan amounts with lower interest rates.

Employment
Many employers conduct credit checks as a part of the hiring process. If you haven’t demonstrated financial responsibility, a prospective employer might be hesitant to hire you. For example, the employer might believe your level of debt is too high for the salary offered.

Entrepreneurship
Many people have dreams of starting their own business. Most startup businesses require a sizable amount of cash that you might not have available. In that case, you’ll need to obtain a small business loan. Among other things, you need to have good credit to qualify for the business loan.

Utility Services
It might be shocking to learn that your credit is needed to establish utility service. Your electric company contends that you’re borrowing one month of electric service. So, before turning on your electricity, the company will check to see if you have good credit. This applies to most utility services including cable, telephone, water, and cell phone.

Since your credit is defined by how you’ve paid (or not paid) your bills in the past, many businesses – landlords, mortgage lenders, utility providers, and even employers – use your credit to predict your future financial responsibility. Anytime you need to borrow money, or even services, your credit is called into question. This is why maintaining good credit is so important. If you have bumps and bruises on your credit, contact Trinity Credit Services at 1-888-669-7372 for your Free Credit Report Consultation.