🚀 Our new App is live!  Signup

🔥 Insane offer! 120,000 points! Grab it

Advertiser Disclosure

Advertiser Disclosure

Although we put in a lot of effort to give our readers unbiased information, and we include many credit card offers on our website for which we do not get paid any compensation, we are legally required to notify you that we may be receiving compensation from some of the credit card companies mentioned on our website.

Some of the credit card offers which appear on helpmebuildcredit.com are from credit card companies from which this site possibly receives compensation. This compensation may impact how and where credit card offers appear on this site. This site possibly does not include all available credit card offers.



8 Reasons Why Good Credit is Important – Including Some Interesting Ones

- Mar 16, 2021 Building Credit, credit2 comments

Good credit is not something that is needed only if you plan on flipping buildings one day. Good credit is something people need on various occasions throughout their life.

In this post, I will make the case of why having good credit is important for everyone – no matter what you plan on doing in life. Whether you’re a plumber, real estate investor, or college student – you need good credit.

1. Buying a Home

In order to get a bank to approve you for a mortgage, you will need to have a good credit score. Income alone is not enough, even if you earn a million dollars a year. As a matter of fact, for a mortgage, credit is even more important than income. If your income is not perfect, then you can still have someone co-sign on the loan and get approved. But if you don’t have good credit then even a co-signer will not help you.

When applying for a mortgage, good credit will also make a difference in the interest rate you will be paying. The higher your score is, the better the interest rate that you’ll receive will be. So starting early on and building a good credit score can save you thousands of dollars in interest for when you decide to buy a house.

FICO estimates that a borrower with an 800 score might have an interest rate that is 1.5% less than a borrower with a 680 score. The difference for a $300,000 loan might be more than $3,000 annually!

2. Applying for Credit Cards

When applying for a credit card, banks will check your credit score and based on that, they will determine if they want to approve you for a credit card. In order for you to get approved for a credit card (and come on, barely anyone uses cash anymore) you need to first build credit.

We often have people reach out to us that they need a credit card asap because of a new business they opened, the need to rent a car, or just to get a good welcome bonus. But when I ask them about their credit score they tell me that they never built credit, as though they figured they’ll build credit when the need arises. When you need credit asap, it is too late to start building credit. You need to start building credit as soon as you turn 18 so that when you need to use your credit later on in life you have it.

3. Getting an Auto Loan or Auto Lease

When applying for an auto loan or car lease, banks will always pull your credit before approving you for the loan. In order to get the best deals on an auto lease (the advertised rate), banks will want you to be in the prime credit category, which is usually a 720 plus credit score. 

4. Getting Auto Insurance

When shopping for auto insurance, a good credit score will work to your advantage. Insurance companies look at someone who is responsible for his credit as someone who is also responsible when driving and therefore deserves a lower premium.

The Money magazine published an article with a research report that shows that a poor credit score can have a bigger influence on your insurance quote than a drunk-driving conviction! Astonishingly enough, auto insurances find that a person with a poor credit score is more likely to cause an accident than someone with a DUI conviction!! (Based on this, you may want to ask the driver before entering a car what his credit score is!).

5. Getting a job

When seeking a job, those with great credit history have a better chance of being chosen to fill a position than those with poor credit history. Employers will ask for consent and pull an applicant’s credit report before hiring employees.

It is believed that about 60% of employers will factor in a credit report before hiring a candidate for a job.  A survey conducted by Demos found that one of ten people denied for a job was due to credit!

6. Renting an Apartment

Landlords may request to view your credit report before allowing you to rent their apartment. An applicant with poor credit history may result in a landlord asking for a larger deposit, asking to find a co-signer, or not renting out the apartment at all.

Landlords don’t look as much on your credit score before denying a potential tenant, as much as they look for charged-off accounts, public records showing judgments, bankruptcies, etc., showing that you were in deep financial trouble. But if a landlord has two applicants to choose from, I believe a good credit history may be a reason for the landlord to choose you.

7. Getting a business loan

Most small business owners cannot obtain a business loan for their business without a personal guarantee. In other words, the bank will not approve the loan if the business owner or the signer on the loan does not have good personal credit. It’s important for a business to slowly build good business credit but it is just as important to build personal credit as that’s the score that will be used at least until your business has approximately $5,000,000 or more in sales.

8. Applying for home utilities

When you apply for home utilities the utility provider will want to run a soft pull on your credit report to check your payment history. Just like a bank lends you money, the electric company is lending electricity to you for 30 days and they hope you will pay at the end of the month. Someone who does not have an established track record of paying their credit card or loan payments, the utility company will be hesitant to lend them the utilities without first taking a security deposit to protect them just in case they fail to pay.


Here in this post I only included a few examples, but of course, there are many more situations where credit may impact something big in your life. So please be a pro and make sure you’re the one with the best credit score on the block!

Want to learn how to build credit from scratch? You’re at the right place! Here at HelpMeBuildcredit.com we do just that. We help people build credit. Check out our most recent post How to Build Credit at 18 – Four Easy (-as-pie) Steps

Wishing You a Lot of Success on Building Your Credit!

Was this article helpful?

Sam Sam has nearly a decade's worth of experience educating his many readers on everything credit. Sam spends his days checking out credit cards for a full report, from the minute benefit details to the shebang of welcome bonuses. Plus studying the ins and outs of building proper credit. It’s his favorite pastime and he loves sharing it with others.

Leave A Comments

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


  1. great ARTICLE!! keep “em coming

    • Thanks Jack!


Recent Posts

Follow us

Click here to subscribe to
our WhatsApp channel

best offers

The Business Platinum Card from American Express

Earn 200,000 points after spending $20,000 within the first 3 months.

more info

Ink Business Preferred Credit Card

Earn 120,000 points after spending $8,000 within the first 3 months.

more info

Capital One Venture X Business

Earn 150,000 miles after spending $30,000 within the first 3 months.

more info

IHG One Rewards Premier Credit Card

Earn 5 Free Nights (up to 60k points value per night) after spending $4,000 within the first 3 months (terms apply).

more info

You May Also Like

Tips On How To Co-Sign Responsibly

Tips On How To Co-Sign Responsibly

Many people who are homeowners today would not have been able to do it without a cosigner. Co-signing on a mortgage loan is one of the biggest favors you can do for your child, relative, or friend, who is looking to buy a home. But co-signing on a mortgage puts a lot...

read more
Average Age Of Credit History -True Or False

Average Age Of Credit History -True Or False

If you’ve ever reviewed your credit report using Credit Karma, WalletHub, Nerd Wallet, etc., you may have noticed that they all break down your credit history based on the average age of credit history taken from all your trade lines combined. For example, if you have...

read more
How To Build Credit History Properly Once And For All

How To Build Credit History Properly Once And For All

There are many people who often complain to me that although they started building credit a long time ago they still don’t have a perfect credit score.  Usually, the reason ends up being that they never set themselves up to build credit properly. In this post, I will...

read more
Do Utility Or Phone Bills Help Build Credit?

Do Utility Or Phone Bills Help Build Credit?

Getting a bill in the mail is not one of the most exciting times in life. Responsible, timely people, though, make sure that their utility and phone bills get paid on time. That’s why I get asked this question very often: How come I don’t have credit? I pay my rent...

read more
How Long Do Marks Stay On My Credit Report?

How Long Do Marks Stay On My Credit Report?

Even if you mess up your credit due to hardship, your credit is not messed up for life. You still have a second chance! The FCRA has set rules for how long negative marks are allowed to stay on your credit report. Here is a list according to each type of mark for how...

read more
5 Types Of Installment Loans And Their Best Uses

5 Types Of Installment Loans And Their Best Uses

Installment loans are a widely used financial tool. They allow you to borrow a specific amount of money and repay it in fixed, regular installments over a predetermined period. Each installment consists of both the principal amount borrowed and an interest component....

read more

Download link sent

Got it * please check your promotional inbox

Error sending download link

Try Again