There are certain situations when you check on your credit score, but it is also smart to make it a habit to check it regularly. Discover why regularly checking it is crucial.
Check It Before a Loan
You will always want to check your credit score before applying for a loan or opening a new line of credit. This will help you get an idea of what rates to expect and whether you can expect approval.
Checking it a bit ahead of time also gives you the time to improve it or correct any issues before applying for the loan.
But why should you check it regularly?
Find Errors
One of the biggest reasons to check your score regularly is to confirm that there are no errors. After all, you don’t want to discover a mistake when you are wrongly denied a credit card or loan.
There may be incorrect information on the report, or perhaps a “negative” item, like a late payment, will show up after it no longer should.
Simply put, looking at your credit score can help you spot errors or even fraud or identity theft.
Understand Your Finances
Looking at your credit score can also give you a better idea of your financial situation. Maybe you forgot about a debt and now realize you need to pay it off in an extreme situation.
A more practical reason is that seeing your score will help you understand what types of loans and credit cards you are likely to be approved for. This can help when planning to buy a home, car, or another major purchase.
Looking at the score can also give you a better idea of how your financial actions affect the score.
See What Lenders See
On a related note, checking your credit score and report will let you see what lenders will when they check. This can be an advantage as it enables you to prepare.
