Loans are a definitely a big help in starting a business, pursuing higher education, making home improvements and more. When applying for one, banks and lending institutions look at an applicant’s credit score, or their capability to manage debt, in order to determine if the applicant is eligible.
A high credit score increases the chances of getting approved for a loan. Aside from an easier loan application process, there are many benefits to building a good credit score.
1. Better relationship with lending institutions
When you pay back your credit on time, this leads to an increase in your credit score. Banks and lending institutions are more inclined to engage in business with customers who are proven to be trustworthy. To build a better relationship with them, avoid going over your credit limit and be sure to settle existing loans and credit before closing those accounts.
The more responsible you are in managing debt, the higher chance you also have of getting approved for higher credit limits from such lending institutions.
2. More special offers and rewards
As you build your trust with banks and lending institutions, you can enjoy more exclusive offers from them. Aside from higher credit limits, lending institutions can also extend discounts and deals from their partners to their trusted and valued customers.
Ultimately, having a good credit score usually leads to more perks that reward your responsible financial habits, so it’s never too early to start building good credit.
3. More negotiating power
A good credit score can give you more negotiating power for credit cards and loans. If you’re seeking for lower interest rates for your loan, you could discuss this with your bank. With a history of responsible debt settlement, the more likely banks would heed to your requests. If you have a low credit score, companies might not budge on your terms.
Keep in mind that the way you handle your credit and loans affect your financial journey. Do all that you can to ensure that you manage it well. You will never know when you will need it, but it’s good to be prepared and ready anytime with a good credit score.
At CIMB Bank, maintaining a good credit score is rewarded. You can get up to 30% interest rebates on your CIMB Personal Loan just by paying your dues consistently and on time. Through the Loan Loyalty program, you can enjoy interest rebates from 10% on the first year up to 30% on the 5th year, credited every 3 installment payments. If you’re a CIMB deposit account holder, all you need to do is to apply and get approved for a Personal Loan on or before June 30, 2021. Seize your life’s goals!