Why is good credit important? YOU PAY LESS WHEN YOU PAY YOUR BILLS ON TIME! That is it in a nutshell. People who have good credit scores because they have a good history of paying their bills on time pay less when they borrow money. Really! See the difference in costs:

Borrower D pays $942.57 more over the life of the loan than Borrower A does. Why? Borrower A has a proven track record of paying bills on time and using credit wisely which gave him a credit score of 725. He is considered less of a risk than Borrower D. Lenders price their products based on risk and most use a credit score to determine the rate of interest that you pay. The range of rates depends of what type of financial institution and where it is chartered. That is why you can see rates like 29% or even 32% on credit cards or even auto loans. MariSol is a federally charted credit union, by law; our maximum rate is 18%. That is another good reason to use a credit union.

How is your credit score determined? Darts, tea leaves? How? First, when lenders talk about a credit score, they usually mean the FICO score developed by Fair Isaac Corporation. It is the most commonly used scoring system. FICO scores range from 300 to 850. There are several models within FICO, but in general, here is how these scores assess what is on your credit report:

At MariSol, we will give you a copy of the credit report that we use for a loan request. At any financial institution, they should be willing to discuss the report with you and advise you how to repair your credit. If not, then consider another place to borrower money.

The Fair and Accurate Credit Transactions Act (FACT Act) enable you to obtain a free copy of your credit report once a year. For detailed information contact the Federal Trade Commission (FTC) at www.ftc.gov or at 1-877-382-4357.