Having credit is such a huge part of life today. So much so that you really can’t make any big life changes, or purchases without having your credit checked. For instance, you can’t just walk into a car dealership and request a car, and expect to get your dream car right then. There’s definitely a process to it, and a credit check is part of that process.
Now, there are actually people out here who have the funds to be able to pay cash for everything. For those of us who are not able to do that, there are other options out there for us to be able to receive additional funds. With these other options, there are stipulations that come with it that we must be informed about that will help us to utilize those options responsibly.
With credit being such a huge part of life these days, it’s very important that you know your credit health. Knowing what your credit history entails will allow you to make informed purchases. Check out these different areas that will require credit checks.
When you first move out of your parents’ house, the first thing that is on your mind is independence. In your own place, you’ll have the freedom to literally do whatever you want. You can stay out as late as you want, leave dishes in the sink, and sleep in as late as you please. Those are the things in the forefront of our minds… we don’t even think about what it takes to achieve that desired freedom; all we care about is getting there.
The process to get your own apartment can be quite difficult. You have to consider the location, the monthly cost of rent, and other utilities that you have to pay. Most apartments require you to have renters insurance, so that is another expense you’ll have to consider, along with your rent.
When you’re in the market, looking for an apartment, your credit score will be checked. Once you’ve found the apartment of your dreams, the landlord will take your apartment application and check your credit to view your credit history. A lot of the times people will call apartment complexes and ask them what is the required credit score they are looking for. Almost all apartment complexes will say that they don’t look for a certain number. This is because they’re really looking at what exactly is on your credit report.
They look at what’s on there versus your credit score because this will let them know whether or not you’ll be a reliable and trustworthy tennant. If the landlord looks on there and sees that you don’t pay your credit cards on time, or have missed payments on several accounts, then it’s going to make them question your accountability on being able to pay your rent, and if you’ll be able to pay it on time. So essentially, apartments look at whether you pay your bills on time, credit score, rental history, your employment, and your debts in comparison to income.
New Credit Card
I can recall being younger and applying for a credit card, and not getting approved. I was puzzled as to why I didn’t get approved. Well, I didn’t know at the time, but your credit score is a determining factor, but it’s not the only thing credit card companies look at.
You can count on credit card companies looking at your credit score, of course, but they also look at your income, the number of hard inquiries you have, delinquencies, and your overall credit history. Those factors will determine if you would be a risk to their company. So, when you’re looking to get a credit card, keep in mind, that credit card companies tend to look at the overall big picture of your credit profile, not just your scores.
People get loans everyday for different reasons. Some people use loans for debt consolidation, while others may use it for unexpected expenses. Whatever reason you may utilize a loan, its important that you understand how loans work.
The great thing about loans is that there is no surprises in your repayment. It’s will always be the same amount with each monthly payment. This is quite helpful because you can actually budget that specific amount every month.
When looking to get a loan, you typically will need to provide proof of income, how long you’ve been there, a list of your expenses and their amounts, and references. They ask for references so that in case they can’t reach your for payments, they can call some of the people closest to you.
When considering a loan, keep in mind a few of these keywords that are associated with loans:
- APR- This stands for annual percentage rate. With loans, you already have interest rates, but your lender will usually charge a fee just for giving you the loan. Your APR is essentially your interest rate combined with any lender fees. This in turn will give you the overall picture of the total cost of your loan.
- Term- Your term is the number of months you have to pay your loan off. You typically find out your loan term when you find out your loan amount.
- Principal- Your principal is the amount you are actually borrowing. As you make monthly payments, your principal will decrease.
A lot of people don’t realize it, but your credit score and history is something that employers look at when considering whether or not to hire you. Your credit score and history is definitely checked when you’re applying for a job in finance. They check this because they’re making sure you won’t be a risk to the company.
They may check your credit and score, and see that you have missed payments or delinquencies. For all they know, you could get into a desperate position and embezzle some of the company’s money to pay off personal debts. To prevent that from possibly happening, they just won’t hire you.