With everything going on in the world right now, a credit score is the last thing on a lot of people’s minds. However, if neglected, it can hurt you for a long time. The pandemic has brought many changes to people’s lives, that can affect some really important aspects. The loss of a job is a big challenge for many people right now. Keeping up with your credit score while trying to navigate a pandemic can be stressful. Here are a few reasons why it is so important though.
Why it’s so important
Your credit score can affect a lot in your life, from being able to rent an apartment to getting a loan, to buy a house.
- A lower credit score can negatively impact your ability to get a loan you need but also can cause you to have a higher interest rate for the loan - if you can get one.
How to check your credit score
This is the only actual free site to check your credit score authorized by Federal Law. Be sure you’re on the right site – many have very similar sounding names:
http://www.annualcreditreport.com
- Free once a year from each of the three major credit reporting agencies (Experian, Equifax & TransUnion).
- Update: Starting in 2020, everyone in the U.S. can get 6 free credit reports per year through 2026 by visiting the Equifax Website or by calling 1-866-349-5191. That’s in addition to the one free Equifax report (plus your Experian and TransUnion reports) you can get at AnnualCreditReport.com1
COVID-19 Considerations
- If you have lost your job during the pandemic, try to minimize the impact on your credit score by paying your bills on time and pay at least the minimum required (preferably more though) with money from an emergency fund.
- See what type of assistance there is currently that applies to you for bill relief.
- See if you are applicable for a mortgage suspension or forbearance.
- If you are approved, make sure to check that the suspension period is credited to you correctly, so it does not hurt your credit score by seeming as though you simply did not pay for those allotted months.
Ways to take advantage of the current market
Due to the interest rates cuts cause by the pandemic, rates on mortgages have fallen since the start of the pandemic. This could be beneficial if you are a homeowner with a higher mortgage rate because you may have the opportunity to refinance your mortgage.
There are also many car deals going on right now as dealers are trying to move product that wasn’t able to be sold due to the pandemic. If you are in need of a new car or know you will need one soon, start researching the type of car you want and see if there are any deals going on worth taking advantage of for your personal circumstances.
Take the time to be sure all information reported is accurate and if not, contact those agencies immediately.
Remember to check both your score and your partner’s credit score as they are reported separately.
Stay healthy and let us know if you have any questions.
1 Source: https://www.consumer.ftc.gov/articles/0152-credit-scores