9 Reasons You Need Good Credit

7) Avoid Higher Interest Rates

Having good credit will do wonders for you anytime you need something, especially those pricier items. Everything from buying a mattress, an engagement ring to a car or home is dependent upon credit. And as mentioned before, interest rates will play a factor in a lenders decision to trust you with their money.

Exactly how much will a higher interest rate will really affect you would depend upon what you are trying to buy. For example, if you were to get a car loan for $25,000 with a 3.11% interest rate, you would end up paying $27,026 for the vehicle. A 60-month loan would cost approximately $450 a month. That same loan with bad credit would have a 12.95% interest rate and cost you $34, 091 for the vehicle with a $568 monthly payment.

That’s a big difference for the exact same vehicle.