Personal Finance

Why is Credit Score Important

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  • Feb 17th, 2013 9:06 pm
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Jul 26, 2012
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Why is Credit Score Important

If your not planning to take out a loan, why is it important?
and what are the benefits of using a credit card over paying with cash or debit
35 replies
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May 8, 2009
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That's the thing, you plan not to loan money but you never know when you will need a loan, ish happens.
Credit card provides rewards whether it be points or cashback. You also get extended warranty when buying with your credit card, less trouble having to carry cash/change every where also.
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Jul 11, 2010
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If in the future you apply for a car loan or a mortgage your credit score will determine the interest rate. As mentioned above some cards have benefits. If you are disciplined and pay them off fully each month you can use them to your advantage.
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taeyang987 wrote:
Feb 10th, 2013 4:54 am
If your not planning to take out a loan, why is it important?
and what are the benefits of using a credit card over paying with cash or debit
Nevermind just loans or the potential to get mortgages/future loans... There are companies out there willing to give you FREE money and rewards based on your credit score. That is a tangible and immediate benefit.
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If you apply for a job where you have financial responsibility, the employer may consider your credit rating. And if you ever apply for a government security clearance, they will look at your credit history.
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A small number of employers are beginning to use credit scores and other things (suitability of online social network information, and the like) to make determinations for offers of employment. The use of credit scores as a determinat factor in offering employment may be on the rise in Canada
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JamesA1 wrote:
Feb 10th, 2013 10:20 am
If you apply for a job where you have financial responsibility, one of the things the employer may look at is your credit rating. And if you ever apply for a government security clearance, one of the things they will look at is your credit rating.
The latter isn't true. Credit checks aren't always necessary to get government security clearance. I have security clearance and have never went through a credit check
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Shaner wrote:
Feb 10th, 2013 10:24 am
The latter isn't true. Credit checks aren't always necessary to get government security clearance. I have security clearance and have never went through a credit check
Jobs related to finance control usually will. For example, select CRA employees will require a credit check to qualify for RS clearance.
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taeyang987 wrote:
Feb 10th, 2013 4:54 am
If your not planning to take out a loan, why is it important?
and what are the benefits of using a credit card over paying with cash or debit
Off the top of my head, obtaining loans (mortgage, car, cash, business, credit cards), rental/leases of property, employment. While not as pervasive as credit scores in the US, they play an important role in many aspects of life.
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Shaner wrote:
Feb 10th, 2013 10:24 am
Credit checks aren't always necessary to get government security clearance. I have security clearance and have never went through a credit check
It depends on what type and level of security clearance you are applying for, and you may not be aware of what they have looked at - the exact details of what they check is kept confidential.
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JamesA1 wrote:
Feb 10th, 2013 12:09 pm
It depends on what type and level of security clearance you are applying for, and you may not be aware of what they have looked at - the exact details of what they check is kept confidential.
I agree with this. Depending on what you're applying for, a credit check may occur, but just getting government security clearance doesn't always require a credit check. I do know my credit wasn't checked nor is it checked for anyone that has the security clearance that I do
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fieldhousehandyman wrote:
Feb 10th, 2013 10:24 am
A small number of employers are beginning to use credit scores and other things (suitability of online social network information, and the like) to make determinations for offers of employment. The use of credit scores as a determinat factor in offering employment may be on the rise in Canada
Right, but as Canadians, we should not be complicit while this happens. It's important that we send a strong message to opportunistic employers; that we will draw a legal line in the sand about what is fair game and what constitutes discrimination in this country. Myself and many others are of the strong opinion that my ability to pay my Rogers bill in the past, should not affect the opportunity to pay my Rogers bill in the future.
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taeyang987 wrote:
Feb 10th, 2013 4:54 am
If your not planning to take out a loan, why is it important?
and what are the benefits of using a credit card over paying with cash or debit
when you apply for a rent, they use credit score for almost everything now to check what kind of responsible or irresponsible personne you are.
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Sep 23, 2007
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Credit score is important for getting loans: namely for mortgage or for a car. But credit score is just a number. It's important to form a consistent habit of good financial management. My advice is NOT to obsess over your credit score. If you focus your energy on being financially responsible, a good credit score will follow naturally. DO NOT think getting a good credit score itself is a good indicator of your financial savvy.

For example, don't do silly things like increasing your credit limit or spending a lot just to improve your credit score.
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Oct 17, 2012
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HyperTech wrote:
Feb 10th, 2013 1:10 pm
when you apply for a rent, they use credit score for almost everything now to check what kind of responsible or irresponsible personne you are.
Is it not the credit report that the landlords check after you sign the consent form? How do they get access to your credit score?

Like the post directly above, credit score is just a number if you don't want to get a loan (although how you can definitely guarantee that you won't need one is a little questionable). Credit report is a history of your liabilities and frequently seen as a marker to your responsibility.
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