Payday lenders are not the ones who will be looking at your credit score, but every other financial institution will. You need to manage your credit score and know how to maintain it. Whatever you can do, try to increase it, and prevent it from decreasing. Letting your credit score dip just a little could keep you away from the funding you may need. It isn’t only your actions that can hurt your credit. The state of the economy and the financial industry has affected people’s creditworthiness. That’s right, because of the economy, you could be doing everything right and still have your credit score go down. Changes in the way financial institutions are loaning, getting money for a car, home, or even approved for low-interest credit cards.
Payday Lenders Lend Blindly to Credit History
Interest rates invariably are affected by your credit score. The lower your score, the higher your rates will be. There are great programs and money opportunities out there, but they are being offered to those with good ratings. Online payday lenders have high-interest rates no matter who is borrowing because of the type of high-risk loan. The same high interest is charged for these short-term loans, no discrimination here. These lenders lend blindly to credit history, and the payoff is expected in under 30 days. If you do not have the money in time to pay off the payday loan, it may not be the best answer for you.
Interest Rates Will Range Depending On Your Credit Score
At this time, mortgage rates can run about 2.6% for those with 760 or more credit scores. A score of 620 used to be respectable but will now bring you an interest rate of 4.2%, which will increase a 30-year mortgage of $250,000 an extra $90,000.
Auto loans could run someone an interest rate of 4.6% on a four-year loan. Many dealers have promotional rates as low as 0%, but they will only apply for those with scores of at least 720. Have a score of 680, and an independent lender will loan to you at 8.9%, costing you at least $1500 extra for a $20,000 car loan over four years. I remember a friend had bad credit and he didn’t have a choice. He bought a car with over 20% interest, that’s the average credit card interest rate.
Credit Scores Affect Your Financial Standing
Credit cards have fluctuating interest rates, depending on your credit scores. The interest of 14%, which is very low for this industry, not including promotional prices, will be available for those who have a credit score of more than 740. Have a score drop under 700, and your rates will about double. Missing a payment will increase your interest rate, and getting it to lower will be a much tougher job.
More Places That Check Credit – Did You Know?
Even car insurance companies and homeowners insurance are jumping into checking credit scores. Apply for a new policy, and the agent will check your credit score to help determine the cost of premiums. The lower the score, the higher the price.
Utility companies will check your credit when opening an account. If your score is below a certain level, they will require the user to make a security deposit or have you sign up for automatic payments.
Payday Lenders – No Credit Bureau Check
The economy and interest rates rely heavily on an individual’s credit history, so more and more people are turning to low-cost payday loan lenders for short-term loans to keep their payments on schedule. The same industry that has nothing nice to say about these online payday lenders is driving customers their way to protect their credit score. Payday lender companies do not credit bureau check to approve you for a cash advance. Your banking information and payday loan history are what matters for loan approval. If you have had any payday loans or cash advances that were late or you did not pay, you probably won’t be able to get approved for a loan. Similarly, you will not be approved if any bank accounts were closed in your history for excessive NSF’s.
Buckle Down And Bear It
As you can see, it’s essential to stay on top of your credit, and even your payday loan lending. Not being responsible with these financial products will reduce your options. Just because you can acquire a credit card or cash advance doesn’t mean you should accept it. It may just get you in a position where you will be drowning in debt. Only use credit cards and payday loans in actual emergencies. You might have to be strict with yourself, buckle down, and watch your spending. You would be surprised that sometimes it’s a matter of two weeks and then the financial stress is gone.