VERY!

Experts warn that to get the best rates in these tough economic times, you need a credit score--a three-digit number that reflects your creditworthiness--of 760 or higher. Previously, that number was around 720 (MSNMoney.com Jan. 22).

The credit crunch is putting the squeeze on your credit score, and one tiny slip-up on your part could come back to haunt you—possibly costing you thousands of dollars over the life of a loan.

Tighter credit standards at some lenders have changed the rules for consumers. Take car buying, for example. No-money-down deals are difficult to land if your credit score is less than 720 (CNNMoney.com Jan. 16). You may have to ante up at least 10% to 20% of the price, or take on a shorter loan period; six- and seven-year loans are hard to find and getting pricier as the recession deepens. The upside of shorter loans, though, is you'll pay less interest.  The down side is higher monthly payments.

Personal Care America Federal Credit Union hasn’t changed our underwriting standards because we believe we had them right the first time.  You can get our lowest interest rate on consumer loans (cars, trucks, debt consolidation, unsecured loans etc.) with a credit score of 700 or better; that’s 60 points lower than the competition!  We also offer 6 and 7 years loans on vehicles and certain other consumer loans.  This can be the difference between being able to afford the loan or not.  Check the rates section of our website for the most up to date rates.  Additionally we are still offering 100% financing on our vehicle loans.

But the interest rate you pay on a loan isn’t the only thing affected by your credit score.  More employers than ever are checking credit reports on prospective employees and a poor report may be the difference between getting a job and not.  Also insurance companies use your credit score to risk rate your auto and homeowners’ policies.  A low credit score may mean higher premiums or worst-denial of insurance.  If you are looking to rent an apartment you may very well find that the landlord checks your credit. 

So you see, your credit score is your life line to financial security.  I will cover steps to take to protect and or repair your score next week.  If you have questions about your credit score ask someone at the credit union or drop me a line, we’ll be glad to help, because after all is said and done;

It’s Only Money,

John