Credit Scores Matter More Than Ever in 2016

Credit Scores Matter More Than Ever in 2016

Credit Scores Matter More Than Ever in 2016

Will the rising interest rates affect your bank account?

If you entered adulthood after 2008, you probably figured out that having a savings account was about as useful as storing cash in your mattress and that interest rates are a single-digit thing. After seven years of fostering a low-interest environment, and the steady rise of the American economy, the Federal Reserve moved to increase rates by 0.25 percent. This increase will affect consumers more than they think, and this is why maintaining a good credit score is now a bigger priority than it has in the past decade.

Credit cards.

Your credit card company may have lured you with the “promise” of a low-interest rate, but you should know that interest rates are variable, not fixed. They could increase your monthly minimum payment and lengthen the amount of time it takes to pay your debt.

Auto loans.

There’s almost always a lag time between auto loan interest increases and an increase in the federal reserve. While existing auto loans are fixed, that won’t stop from interest increasing for those that have yet to take out a loan for their car. Car prices may also increase as dealers try to dampen the cost of paying higher interest on the cars in their lots. Other dealers, however, may stick to promotional prices and may offer good sales. But these offers are usually for those with a good credit score.

Student loans.

Don’t worry, students: you’re not off the hook either. Loans taken before 2006 will likely see a rate increase. People who meet this qualification usually refinance their loans in order to turn their loans into a fixed-rate loan to avoid.

Having a good credit score can mean the difference between a good interest rate, and one that will break your bank (by which we mean your account, your actual bank will be fine). Choose the one that’s right for you! For all of your home buying needs throughout the Solana Beach, California area, contact the professionals at Ranch & Coast Mortgage Group Inc.