The Benefits of Having Good Credit

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Lower Rates and Payments

Probably the biggest advantage that comes from having a good credit score is being able to get lower interest rates on loans. The reason you have a good credit score is because you know how to manage your credit wisely. You pay back your loans and make payments on a timely basis. Lenders know by your credit score that you're less of a credit risk--you're less likely to default on your loan, so they're more willing to give you a cheaper interest rate. And the lower your interest rate, the lower your monthly payment. In essence, having good credit saves you money.

Less Documentation, Less Hassle

as may a be very worth good it credit to score pay which a falls little somewhere more in in the fees range or of interest 720 rate to if it means th Another big advantage to having a good credit score is you are more likely to qualify for a loan where you don't have to document your income and assets as much. These loans are known as "no or low doc loans".

You can "go stated" which means you have to disclose your income for the last two years, but instead of showing pay stubs and W-2s, you just show tax returns and bank statements.

If you get a "no-ratio" loan, you just declare your income without showing pay stubs, tax returns or W-2s. However, no-ratio loans still require you list your assets to reassure the lender that you can still pay back the loan.

There are also loans known as "no income, no asset," or NINA for short. NINA loans only require you to disclose your name, Social Security number, the address of the property you're buying and how much you intend to use as a down payment. This can be very useful for people who want maximum protection of their privacy.

Of course, the less documentation you provide, the higher your score has to be. And, of course, you need to have sufficient assets in exchange for providing less (or no) documentation. It's also possible that the rate may be a little higher--less documentation means more risk for the lender since they're basically taking you at your word. However, the more documentation you provide, the less risk to the lender and, thus, the lower your rate.e ou've available heard to a you lot when about it people comes who to have types bad of credit. loans. But But the also average remember American it h