Why Your Credit Report is More Important Than Ever

Is your credit score hampering your financial progress?

At the start of every new year people run out and start new fitness regimes, get new wardrobes and hairstyles or buy new furniture pieces, but there is one question I continually get: Is your credit report still relevant or important?

I can give you an unequivocal answer: Yes!

Due to the downturn in the economy, high unemployment and the housing crisis, many seem to think that the credit report will soon be obsolete because of the deluge of people dealing with credit and financial issues.

This is simply not true. Your credit report is one of your most important financial documents.

Here’s why:

  1. Your credit report is reviewed for all types of financing: credit cards, mortgages and car purchases.
  2. Your credit history is now being reviewed for health insurance, car & homeowners insurance, apartment rentals and phone and cable connections.
  3. When lenders review your credit history information, your credit score plays a big role in setting your interest rates and repayment terms.
  4. Potential employers are now reviewing your credit report. Your credit score and the way you pay your bills is now being viewed as a character issue and as indicative of how successful you will be on the job.

How credit history reports benefit you:

If your track record of building your credit history is good or even excellent, it will pay off because it will save you money on interest charges. The same rule applies to insurance coverage; a high credit score means lower monthly premiums.

Also, and this is important, in the wake of high unemployment, a good credit score will make your background check for potential employment a non-issue.

What can you do to protect and improve your credit history? Make positive changes now. Get your credit score and report (you’re entitled to a free one every year) and take steps to monitor your credit. Taking control and managing your credit history will eliminate any unpleasant surprises for you when lenders, property managers, and potential employers investigate your financial reports.

The importance of credit today is significant; overlooking this fact can be very detrimental to your financial health.

Black Enterprise Columnist Jennifer Streaks is a Financial Expert, Author & Pundit. Continue the conversation by following her on twitter @jstreaks or going to her website www.JenniferStreaks.com.

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