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Importance of Knowing your Credit Score

If someone were to ask you about your credit score, would you know it? Don’t worry if you don’t know this figure, as a majority of the Canadian population is on the same boat. No one even thinks about their credit score, unless they have to apply for a loan or a credit card.

It is quite easy to forget to check your credit score, which can have a negative impact in the future. Some people don’t want to check their credit score, as they are scared of what they will find out. To have proper control over your finances, it is vital that you know your score. Here are three reasons which highlight the importance of knowing your credit score:

Ensure the information is always accurate

The information present in your credit history has an impact on your scores. By going through your credit history, you can find out if the information on the report is accurate. However, there will be times when your credit score takes a hit even though you haven’t made any late payments. If this is the case, you know the credit bureau made a mistake, which you can fix immediately.

Get lower rates of interest on your car loans and insurance premium

One of the major reasons why you should be aware of your credit history is due to its impact on the interest rate on your car loan. If you are in the market looking to purchase a car, taking an auto loan, increases your options immensely. When you know your credit score is higher than usual, you can approach a lender or dealership and get lower interest rates.

Similarly, it also affects your insurance premium, as several providers use credit history to adjust this value. For instance, a person with bad or no credit will have to pay a higher premium, when compared to those with good scores.

Understand how to improve it

When you are aware of your credit score, you can find out how your decisions have an impact on this figure. For instance, you can see how paying off the balance on your credit card affects your score. With this knowledge, you can use several techniques to improve the score.

These are the three reasons why you should know your credit score. If your credit score is not good and you want to take a car loan, you should get in touch with TakeTheDrive!


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