‘Fair’ vs. ‘Very Good’ Credit: The Impact on Mortgages

Consumers who make efforts to raise their credit scores from “fair” to “very good” may see big payoffs. LendingTree researchers analyzed loan request and average loan balance data to see how a lower credit score can increase borrowing costs for the average consumer. They compared the impact across several types of debt: mortgages, student loans, auto loans, personal loans, and credit cards.

Overall, raising a credit score from “fair” (580-669) to “very good” (740-799) can save a consumer $45,283 on their debt. That’s the average in extra interest on all debt that consumers will pay when they have a credit score ranked as fair. Mortgage costs can account for 63 percent of those potential savings. By raising a credit score from fair to very good, consumers could save $29,106 in mortgage costs, the study shows.

Read more…

Advertisements

Leave a comment

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.