Poor Credit Score Consequences.
A person’s credit score represents his/her creditworthiness and the financial behavior. Your credit score tells the lender, whether or not, you will be able to repay your debt.
A bad credit score is something you don’t want to have. But, there are times, when your credit scores can go down; and this situation will have severe consequences. The biggest disadvantage is that you loan application won’t be approved.
Poor credit score won’t be a problem on Pikavippikone, as there are many lenders, who can grant you a loan, even with the worst credit score.
Some don’t know the importance of a good credit score, below are the damages that are caused due to a bad credit score-
1. High-Interest Rates on Loans and Credit Cards-
If you have a poor credit score, lenders believe that it is perilous to, offer a loan for you. Hence this risk is made up with the high-interest rates. Lenders set the Annual Percentage Rate(APR) or the rate interest, based on the risk that you pose. With a good credit score, you will qualify for the low-interest rate.
2.Renting an apartment will be difficult with bad credit score-
Some landlords check your credit score before lending their apartment for rent or lease. And a bad credit score makes it difficult for you to get an apartment. In simple words, a bad credit score, can leave you homeless.
3.You will be charged with security deposits on the utilities-
If you need a new phone, cable or electricity connection to your house, you need to apply for it. These utility companies will check for credit score before your application approval. If you have bad credit score, then the companies will ask to pay a security deposit, to establish service for your name.
4. Purchasing a new car becomes difficult-
Before a car loan is approved, your credit score is checked. With a poor credit score, your loan application might get denied or approved with high-interest rates.
5.Bad credit leads to high insurance premiums-
Insurance companies link low credit scores to higher claims filed; hence they charge high premiums.