Head-knock to Individuals with Low or No Credit Scores: The Importance of Average Credit Score in US

In the United States, more credit scores means higher opportunities. You are considered lucky if you obtain and maintain high credit scores compared to those who have incurred no credits at all. It is a popular belief that having high credit scores denotes to being fully responsible with handling your finances. Moreover, good credit scores also equates to keeping up your integrity. To sum it all, high credit score equals good reputation.



Who do not want to earn a good reputation? If you are most likely to apply for any credit program and you wish to see an “approved” mark on your application sheet, then you must avoid the following:



1. No Credit Score.



Having no credit score at all denotes that lending institutions will not have any basis on how you handle your finances even if you are good at it. The credit scores are lending institutions determinant to get you approved with your credit request since they cannot gauge your financial history through:



? Race and origin. Lending institutions will not approve your credit request because you are white or black or you are from the United States or from the European countries.



? Type of employment and salary. Even if you are a janitor and yet incurred high credit scores, then your loan application might be approved over a company manager who has zero credit score.



? Education. Whether or not you have obtained a college degree it does not matter, what matters is a high credit score.



Lending institutions cannot measure approval of your credit request into your religion, age and marital status. This is due to its being subjective. The Equal Credit Opportunity Act sees that the most objective determinant is through looking at credit scores.



Through credit scores, lending institutions will get familiar with your financial background. They will find out the previous and present loans you have, the down payments you have doled out, the interest rates you choose, and most importantly the payment scheme that you have established.



2. Low credit scores.



The average credit score in US is somewhere between 580 and 650. There are major institutions in the US who determines if you are suitable to be given credit. Equifax, Trans Union and Experian are major institutions who compute for borrower’s credit score. All three have their own distinct computing system yet still adheres with the national average credit score.



If your credit score falls below the standard credit score, then you are highly prone to seeing your credit applications with “disapproved” marks.



Having credit is not bad after all; it will look appalling if you have been immature on handling such matters. A credit card may be handy for most of the time especially when cash is not readily available. Additionally, others find credit cards safe to bring than stocking cash in your wallet.



Loans, on the other hand are equally important as credit cards especially for those individuals who aspire to have properties which they cannot immediately pay.



With the significance of having cash substitute in the form of credits, it is helpful to get good if not high credit scores. There is nothing wrong with getting high credit scores; all you need to do is be responsible in handling your finances. By doing so, credit will not be a nuisance but will serve as a great aid to you.