Financial Advice

4 Times You’ll Wish You Had a Better Credit Score

Credit scores aren’t the easiest things to understand. Most people know it’s important to have good credit scores, but you might be surprised to learn how frequently this aspect of your finances plays a role in your life.

Mostly, credit scores come into play when you’re applying for credit (hence the name), so it’s especially important to look at your credit scores before applying for a loan or credit card. On top of that, there are plenty of times a good credit score can help you save money or reach your goals, which is why it’s smart to regularly review your scores. There are many ways you can get free credit scores, including the two free credit scores you can get every 30 days on

1. When You’re Apartment Hunting

Even though rent payments aren’t always reported to the credit bureaus and aren’t a factor in many credit scoring models, having a good credit score can help you land your next apartment. If you live in an area where apartment hunting might as well be considered a competitive sport, a great credit score can make your life a lot easier.

Some landlords just look at your credit reports, others get specialized tenant scores and some might look at one of the many credit score models out there. You probably won’t know exactly what they’re looking at (which is true of any credit check), so focus on the basics that factor into most consumer scores: Pay bills on time, minimize your debt and apply for new credit sparingly.

2. When You’re Setting Up Utilities

A good credit score indicates you have a solid history of paying bills on time. Even though utility bills generally aren’t reported to credit bureaus or factored into credit scores, failing to pay utility bills can result in a collection account on your credit report, which in turn hurts your credit score.

If your new electricity, water, Internet or other provider sees you have a low credit score, it may request you pay a deposit (or a higher deposit) when signing up. That way, if you miss payments, they’re covered. Oftentimes, you get that deposit back after a series of on-time payments, or it’s credited toward future payments. Still, it’s nice to not have to pay a deposit in the first place.

3. When You Need to Go Car Shopping

Unless you’re paying cash for your next car, you’ll probably need an auto loan. As with most credit instruments, the better your credit score is, the lower the interest rate you’ll likely get on the loan. You can also access better interest rates by increasing your down payment, but no matter how much you need to finance, you’re going to be better off with a high credit score.

4. When You Have to Insure That New Car

In most states, an insurance underwriter can use your credit score to determine your auto insurance premium, and in some states, your credit will have a significant impact on how much you pay. This practice varies by location and insurer, but be aware that good credit could save you money in this area. A credit score can be an even better predictor than your driving record, according to industry experts.

You can read the full article, 7 Times You’ll Wish You Had a Better Credit Score on

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This article by Kali Geldis was distributed by the Personal Finance Syndication Network.