If you’re like most of us, you probably rarely think about your credit score. After all, it’s not a number that pops up in day-to-day living. However, if you’re going to apply for a loan, a credit card, etc., it’s a number that will impact whether or not your application will be accepted, and in many cases, what your interest rate will be (better score, better rate).
We all want to have control over our financial lives. And in order to have that control, it’s absolutely necessary to check your credit score on a regular basis. Let’s talk about why.
You’ll know where you stand in the eyes of financial institutions
Whether your credit score is good or bad, wouldn’t you rather know where you stand, especially if you’re thinking about a future loan? If your score is less than stellar, you can take steps to improve it. If it’s good, your goal should be the maintenance of it.
You’ll be able to spot potential errors on your credit report
Did you know that your credit score is a direct reflection of your credit report? If you know your credit score and monitor it frequently, you’ll likely know whether or not your credit report is correct. If you see a drop in your credit score and don’t know what caused it, this may be a warning sign that there’s a mistake in your credit report that you’ll need to dispute.
You won’t be surprised on financial applications
Regardless of the outcome (positive or negative) on a financial application (a loan, a new credit card, etc.), if you know your credit score and monitor it closely, you likely won’t be surprised as to whether you’re approved or denied. No one likes to be blindsided.
You’ll be able to address changes faster
If you’re monitoring your credit score on a regular basis, when you see a significant change, you’ll be able to respond more quickly. If your score drops, you can take steps to recover your points right away.
You’ll have a better understanding of what hurts your credit score and what helps it
When you pay attention to your credit score frequently, it’s much, much easier to understand how your financial decisions affect your score. How does paying off a loan balance or credit card affect your score? How does opening a new credit card affect you? How does applying for a car loan impact your number?
When you know how your financial actions affect your credit score, you’ll know exactly what to do and what to avoid to keep your score in tip-top shape.
If you haven’t been monitoring your credit score, it can be overwhelming to understand how to start. A great first step is to choose where you’ll be checking your score.
Republic Bank of Chicago offers Credit Insights, an awesome, free, Mobile Banking app that helps you understand your credit health, and make improvements in your credit score. This app is included in your Republic Bank Mobile Banking app, so there’s no need to download anything new. (Who has data for that, anyway?)
We can’t emphasize enough the importance of monitoring your credit score. If you’re currently on top of it, good for you! If you’re not, don’t worry… the best time to start is right now.