Five ways your credit score can affects you

You know a low credit score can make borrowing money more expensive, or even be the reason you were denied credit. But you may not know your personal credit history can impact your life in other ways.

Renting an apartment or house

Landlords typically will check your credit report to see if you have a pattern of paying bills on time. If your report shows a history of missed or late payments, you might be asked for a higher deposit, be required to get a co-signer or even have your application rejected.

Loan rates

Your credit score commonly influences what it costs for you to borrow money. Borrowers with the highest credit scores represent the lowest risk to lenders. That reduced risk is reflected in the lower interest rate top borrowers pay when they borrow money. Conversely, borrowers with a poor credit history represent much greater risk to lenders, and when they borrow money they will pay higher interest rates on that debt. This includes auto loans, credit cards and mortgages.

Cell phone

Cell phone companies will check your credit score before granting you a service plan. People with poor credit may be asked for a larger down payment or they may be required to pay extra for a service contract.

Employment

Employers must get written permission before they can review your credit report. Typically, they are looking for major negative events or discrepancies. If an employer declines your application based on your credit history, he or she must notify you and provide you with a copy of your report.

Insurance

Home and auto insurers can consider credit data to determine your rates and terms. The reports and scores used by insurance agencies are slightly different than what is used by creditors and lenders, but the basic information and scoring should be similar. The higher your credit score, the lower your insurance rates are likely to be.

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