Why Do I Care About a Low Credit Score?

A low credit score limits the consumer in countless ways. For example, a score under 700 could literally exempt the consumer from the ability to attain a loan or line of credit. In today’s economic climate, lenders are as conservative as ever. That means if you have a low credit score, you will either not be able to qualify for the loan or you will be charged higher interest rates. Even though a few points initially may seem like no big deal, over the course of time, say 30 years for an average home loan, a low credit score, thus higher rates costs you tens of thousands of dollars in interest fees alone. Sure, if you improve your credit score and the fed offers lower rates, you could definitely refinance, however you’ll have to increase your credit score substantially to be eligible to refinance your mortgage and this takes time, patience and a sound strategy.