First, what is considered a bad or challenged credit score? That would be anything below 640. Using industry averages, your monthly payment on a $200,00 home loan would be $1136. Excellent credit (750+) pays just $955, saving $185 a month. That's a yearly savings of $2220!
Shopping for a new vehicle? On a $30,000 car purchase, a buyer with challenged credit would be looking at a monthly payment of $601, versus $525 with an excellent score. That's a monthly savings of $76 and an annual savings of $912.
There are similar savings regarding insurance. Taking both home and auto rates into consideration, with a poor score your combined monthly total would be $196. With an excellent score, your rates would drop to a total of $125. Putting $71 dollars back into your wallet monthly and saving you $852 a year.
Combined yearly savings for mortgage, auto and insurance rates would add up to $3981 a year! That's a nice chunk of change we're sure you could find a better use for!
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