Fico Help Central

Did you know surveys show that 9 out of 10 consumers are unaware what their Credit Score is? While I find that hard to believe, I’d like to quickly show you why you should improve your credit score, because it could be costing you a fortune (in more ways than you can imagine).

We all know a low credit score will make everything in the world of finance more expensive because of higher interests rates from lenders due to being considered a greater credit risk (i.e. higher interest rates
on cars, homes and credit cards). While this may be considered common knowledge by some, few truly understand the devastating effects.

For example. If you obtain a $200,000 loan on a 30 year fixed mortgage at 8% interest instead of 6% (because of your credit score), that 2% is going to end up costing you a total of $96,934.11 over the term of the loan. Now, think about how many extra years you’ll have to work to pay off $96,934.11 because of an extra 2% in interest?

And the damage doesn’t end there. A low credit score will affect all of your living expenses. For example, in addition to paying more for a home, car and interest on your credit cards, a low credit score will affect the following, as well:

1.) AUTO INSURANCE. As many as 92% of the 100 largest personal automobile insurers use credit information to underwrite new business, according to a 2001 study by Conning & Co., an insurance-research
and asset-management firm.

2.) HOMEOWNERS INSURANCE. It’s thought many insurance companies see a correlation between low credit scores and increased property insurance claims. Therefore, a low score will result in a higher rates.

3.) LIFE and HEALTH INSURANCE. Customers who are unable to pay their monthly insurance premium thereby pass along that increased cost to the insurance company whose stuck with the bill (resulting in a loss for the company). Since customers who pay without lapse are more profitable it is felt by many that a low credit score now even affects a monthly life and/or health insurance premium negatively.

If you are able to improve your Credit Score, you will save yourself a small fortune over your lifetime. To learn more about how to dramatically Improve your Credit Score, visit my website at www.ficohelpcentral.com.

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