To answer any questions about the importance of a good credit score, you need to consider what you are trying to do. Are you thinking about applying for a major loan – such as a mortgage? If so, a high credit score is important. On the other hand, if you have a home, a car and the credit cards you need, your credit score may be less important.
Here’s why: The higher your credit score is, the easier you will be able to get approved for a line of credit. Further, a good credit score will allow you to get a lower interest rate. This is because lenders use the quality of your credit score as a guide to determine whether you are a good credit risk. If you have a high score, they reason, you are more likely to pay back your debt.
The credit reporting agencies determine your credit score based on a variety of factors including how much debt you have and whether you have an income that will allow you to pay your debts. Therefore, it’s important to pay your bills on time and not take on more debt than you can pay. The bottom line is this: if you aren’t looking to borrow money, your credit score isn’t so important.
If you are in over your head in debt or have questions about your debts, contact an experienced bankruptcy lawyer who can explain your options regarding bankruptcy protection. Joel R. Spivack, Esq. has been guiding families in Cherry Hill, NJ and throughout South Jersey through the bankruptcy process for more than 20 years. Contact him today for a consultation about your situation.