Working on your credit score can make a critical difference in your long term financial success.
For one thing, maintaining a good credit score can save you money when taking out a loan. A borrower’s credit score typically factors into how much they have to pay in interest on mortgages, car loans, student loans and personal loans.
Interest rates for all kinds of credit products have soared since the beginning of last year as the Federal Reserve has tried to slow down inflation. As a result, your credit score can make a bigger difference than normal as far as monthly payments.
For example, in the context of mortgages, a buyer with a 620 credit score, which is considered “fair,” would qualify for an average rate of 8.55% for a 30-year fixed-rate conforming loan. On a $350,000 loan, the monthly payment comes out to $2,705.
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