How does knowing your credit score save you money?

Question

Your credit score is your credit score. There is very little you can do about it or with it. It is like your age or I.Q. How will knowing what it is help you?

Answer 1

There is something you can do about your credit score.  Pay everything you owe on time as agreed.  That will improve your score if it needs improving.  

Knowing what it is would help you only by knowing before applying for a loan whether or not there's a chance you'd get approved for it.  Knowing your score might also help you make a decision about accepting a credit card with a terrible rate - if you know you have good credit, you can be confident you can get a better rate.

Personally, I don't think it's that big of a deal but that's because any problems I had with my bills were a long, long time ago (luckily and hopefully it will stay that way!).  My score is good but it doesn't really affect me because I don't plan on borrowing any money any time soon.

If someone actually knows how knowing your credit score can save you money (in some other way than what I've mentioned), I'm very interested to read the answer.

Edit to add:

I agree that keeping an eye on your credit REPORT is a good idea, which is why I take advantage of the free annual credit reports.  I don't think it's necessary to pay to have one of those watch services monitor your score for every little change though.

Answer 2

You can act differently in the future to build your credit score. The higher, the better, especially when it comes to getting loans, credit cards and buying a house. If you have a credit score of say 640, you will pay a lot more for a mortgage than someone with a credit score of 750. If you know you have a good score, going in to borrow money at a bank, you can bring it up and may be able to negotiate a lower interest rate on your loan.

There are lots of ways to raise your credit score, and if its low, waiting for a year or so to restore your credit will save you  a lot in the long run on a big purchase, like a mortgage or business loan.

The average American's credit score is about 70 points lower this year than it was two years ago, and its a great reflection on just how unwise many people are when it comes to money. I have raised mine drastically in the past ten years, mostly by just paying all my bills on time or ahead of time, and not going above 50% of the available credit line on a credit card. (If the credit line is for $10,000, you shouldn't have more than a $5,000 balance.) Learn a little about this, and it can make life much easier and less expensive.

Answer 3

It's a good idea to get an update on your credit score every now and then.

But finding out what your credit score is will actaully drop your credit score.

Answer 4

People with better credit history and score will be treated better in business world and bank.

However, just by knowing and having high credit score doesn't really help you.

Real credit score, one bank sees not only by score but length of credit card history, is really like your age.

Me, with 740 and 20 year old, doesn't really get that much better respect from bank.

But, in 10 years, 740, or even 800+ will definitely help me gain respect from the bank and loan companies.

Like, having Diamond or 7 star membership with Paris Hotel gets you much better rooms, services, and respects.

Answer 5

I think it's more of a 'play defense' move.  If you keep track of your credit score and you see it start to plummet and you are not taking out multiple credit cards and loans and you're making your payments on time then it's a good tip that someone may be messing with your identity and opening accounts in your name.   I keep track of mine for security purposes to help track and protect my identity.

Answer 6

Don't even know all about it myself. I can give you an example though. When I moved into my apartment we had to get cable and electric hooked up. And since my credit was superb I didn't have to pay an extra fee. The fee for each if your credit was bad was 250 dollars each. So saved me 500 right there.

Answer 7

If you knew you had great credit, would you pay high interest rates?

Answer 8

i agree 100% knowing it does not help a bit -- getting is up to 850 is really the goal and by doing that it will say loads over a life time!!!

Answer 9

If you have a credit score of 750, you'll get a better interest rate on credit cards, real estate and vehicles than if you have a credit score of 550.  If the bank tries to give you some heinous interest rate, you'll know you can do better by going elsewhere, and you can tell them to sharpen their pencil or you're gonna walk.

If you have a Washington Mutual credit card, you can have instant access to your credit score 24/7 for free on their website.  The credit bureaus usually charge a fee for this information.