If you’re not buying a house or car anytime soon, and you rarely use credit cards, you may think your credit score is not that important. But with a growing number of companies using credit history and credit scoring to decide whether or not they want to do business with you, what’s on your credit report can have far-reaching affect, meaning even in aspects of your life where you wouldn’t expect it.
Consider these five unexpected ways your credit history affects your life:
1. Your living arrangements
It’s against the law for landlords to discriminate against applicants based on factors such as race or gender, but it’s acceptable for them to base leasing decisions on a tenant’s ability to actually pay the rent. If your credit report shows you’re inconsistent about bill-paying, a landlord might interpret that to mean you wouldn’t be able to pay rent in a timely manner.
2. Your education
Student loans used to be the easiest kind of loan to get, with the most lenient repayment terms. However, the credit crunch has changed things, and schools and lenders that were once relaxed about student loans are now more demanding. A low credit score could make it difficult for you to obtain the student loans you need to attend your college of choice.
3. Your cellphone
Say two years ago, when you entered into your current cellphone contract, your credit score was pretty good. The cellular provider probably approved your new account application right away. Now, imagine you would like to switch providers at the end of your contract, but your credit report has a few blemishes and your score has dropped significantly, thanks to the recession of the past few years. The mobile company you want to switch to may require a hefty deposit from you before they’ll open a new account in your name.
4. Your employability
A growing number of employers (around 50%) are considering credit history as another way to differentiate potential candidates from the pack of applicants. While your experience, education and skills will always be meaningful in your job hunt, a low credit score or spotty credit report could mean you have to work harder than a high-scoring competitor to win a potential employer’s interest.
5. Your pets
What does credit have to do with Fluffy or Fido? A lot, actually. Even if you pay cash for your pet’s day-to-day needs like food, emergencies can arise when you’ll need credit. For example, if the vet says your dog needs an expensive operation, your good credit may qualify you for a payment plan to cover the cost. In that scenario, your credit score could help you immediately secure needed treatment.