Spending Less on Interest by Improving Your Credit Score

Did you know that by increasing your credit score, you actually save money? If you are on a mission to save, you need to consider your current FICO score. When determining if you are a creditworthy borrower, creditors use your credit score, which is also what dictates the amount of interest that you will pay on loans and revolving credit. By having a high FICO score, the amount you pay for mortgage and credit card interest rates will be far less, which equates to a nice savings.

As an example, a FICO score of 625 is considered a little above average. Because of that, someone with that score could probably get approved for a mortgage loan but the amount of interest charged would be higher compared to someone with a higher credit score. At 625, the interest for a $100,000 mortgage would be around 5.62 percent. At that rate, this person would have a monthly payment of $575 and spend $207,000 during the life of the loan.

Now, if that same individual were to bring the credit score up to 720, which is considered above average, locking into a mortgage loan would be much easier. In addition, the amount of interest charged on the same $100,000 loan would only be 3.89 percent. Not only would the payment drop to around $471, saving close to $100 each month, at the end of the loan, this individual would have paid just $169,000, a $38,000 savings.

In talking to an Rome bankruptcy attorney, you will discover that going through bankruptcy does not automatically mean that your credit is ruined. In fact, a bankruptcy will actually cause your FICO score to improve. The reason is that unsecured credit is eliminated in bankruptcy. Therefore, the amount of debt owed decreases substantially. Although a bankruptcy will remain as part of your credit history for 10 years, you still have viable options for bringing your score up.

By talking to a qualified Rome bankruptcy attorney, you can learn about the different ways of improving your credit score, even after filing bankruptcy, as well as staying out of debt in the future. With detailed information, you will have a clear understanding of the things that need to be done to improve your FICO score. After all, the goal of a reputable Rome bankruptcy attorney is to help you get through the proceedings and qualify for lower mortgage and credit card interest rates two years after your case is closed.

Although you can try to improve your FICO score in two years without the assistance of a bankruptcy attorney in Rome, having someone with legal experience and expertise in your corner will certainly make the process easier, faster, and more successful. Before long, you will be debt-free and in a much better position financially.

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