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What is my Credit Score Used For?

(Know Who Stalks Your Credit)

Just like your LinkedIn profile, people are looking at your credit. Some of them want a quick way to judge whether or not you are responsible. Others want to know if you’ll pay them back if they lend you money.


If you have poor credit, you could get interest rates nearly 60% higher than the national average because lenders see you as a bigger risk. Check out this calculator to see what kind of interest rates you might qualify for based on your credit score.


What does a low credit score have to do with your driving abilities? Insurance industry research has shown that those who manage money responsibly are more responsible in other parts of their lives.

If you need auto, renters or homeowners insurance, insurers will look at your credit score. And a low score could mean you'll pay up to $22,815 higher premiums over your lifetime than someone with a stellar score.


Part of getting your own place is paying for utilities like gas and electricity — and utility companies want to make sure you’re good for it.

“Some [utility companies] won't extend credit without a large deposit if you have a negative history,” says Gerri Detweiler, a credit expert with


When you get a cellphone, the provider might check your credit report to see whether you've been paying your bills on time. If you have a spotty credit history, they may require you to put down a cash deposit as high as $500 before giving you an account.


To many landlords, a lower credit score means you're more likely to be late on rent or miss it altogether. That’s why New Jersey landlord Jerry Lynch checks his potential renters’ credit scores.

"If they haven’t paid people they owed money to in the past, there’s a very reasonable chance they won’t pay me," says Lynch.

Like many landlords, when Lynch encounters possible renters with bad scores, such as college students or young adults who have never used credit, he requires them to get a co-signer on the lease.

Two young adults discuss who looks at your credit score and how credit is used.


\ Interest Rate Calculator


Thanks to the Fair Credit Reporting Act, an employer has to ask your permission before pulling your credit report; and they must disclose if they don’t hire you because of something on the report.

Although studies haven’t proven that your credit score is connected to your job performance, poor credit can be a red flag. Some employers think you’ll have a hard time managing the company’s money if you’re struggling to manage your own.

It gets even more serious for government employers like the armed forces.

"Members of the military can even lose security clearance or be deemed ineligible for promotions if they have credit issues," says Will VanderToolen, director of counseling services at AAA Fair Credit Foundation in Salt Lake City.

So, to sum it up, you have to keep your credit score looking good. Trust us when we say that it makes life easier.

As always, we’ve got your back. — The On Your Own Team End of article insignia

[Any reference to a specific company, commercial product, process or service does not constitute or imply an endorsement or recommendation by On Your Own, the National Endowment for Financial Education or any of its affiliate programs.]