A good credit score always translates to trustworthiness for banks and financial institutions. Maintaining a good credit record can bring you a lifetime of banking convenience and perks.
Having a high credit score opens the door to a lot of money-saving opportunities that can lead you to great savings and banking privileges.
What should I do if I have a high credit score?
A good credit score gives you leverage to negotiate lower interest rates on a credit card or a new loan, get a higher-tier credit card, and other exclusive benefits.
If you need more bargaining power, you can enjoy the favors of other attractive offers that you can receive from various companies based on your credit score.
Looking for other reasons why you should maintain your excellent credit? Here are some great benefits that you could put to good use.
1. Ask for lower interest rates
Lending institutions charge you an interest rate that is often based off of your credit score.
A good credit score will almost always qualify you for favorable interest rates and, as a bonus, lower finance charges on credit card balances and loans.
Why? Well, because interest rates on credit cards and loans are directly related to the credit risk you pose, which is measured by your credit score. When you have good credit, you have the power for negotiation.
2. Ask for higher credit limits
If you have an excellent credit score, you’re more likely to get a higher credit limit on your credit card, provided your income is enough to handle that credit limit.
Your income and your credit score determine your borrowing capacity. A good credit score makes banks and other financial institutions more willing to approve your application because they can see that you have a history of paying your financial obligations on time.
The amount of credit a card issuer is willing to extend to you is also based partly on your credit score. With an excellent credit score, you’ve likely demonstrated that you can handle credit responsibly.
3. Ask for a shorter loan term
If you applied for credit cards when your score was low, then you probably have an annual percentage rate that’s too high. This is easy to solve.
Since an excellent credit score gives you a lower monthly payment, you may even be able to choose a shorter loan term, which saves on the total cost of interest and lets you pay off your loan much sooner.
Call your issuer and explain that you’ve worked super hard on your credit and your score is now near the exceptional range. Have you received offers for other credit cards recently? Often, when your score goes up, you enter a new credit category, and that gets the attention of financial institutions.
Doing this is a little like dating. When you’re in demand, everyone wants you. So, don’t be afraid to use a little leverage to get top rates.
4. Upgrade to better credit cards
While keeping the same credit card or cards for several years is actually a good thing for credit card history, there’s no harm in upgrading.
When you have an excellent credit score, you can check on different banks and financial institutions to see which cards you now qualify for. You may be surprised that other than the prestige experience, there are a lot of VIP perks that will now be accessible to you.
5. Have a loan and insurance check-up
If you’re looking for refinancing, keep in mind that a strong credit history is often the key to getting approved. Check with your home and car insurance and home insurance providers and compare quotes from other insurers as well.
Sometimes switching over once your credit has improved can pay off. Consider other things as additional fees, or closing costs, to make sure you’re upgrading to a better deal.