Many people think that they can skip their credit card payments and loan EMIs without worrying about the credit score. That’s not the case. If you understand the concept of credit score, then make sure you don’t try to skip your payments ever. Here is how the credit score works and can affect your future transactions in a positive or negative manner-
In simple words, it’s a three digit score given to you based on your credit history. The more regular you were in the past with your payments, the better would be the score. For those who have never indulged in any credit transaction, the credit score remains zero.
Mortgage vs Credit Score
You may find yourself in such a tough situation when you’re short of funds and the question crossing your mind over and over again is — should I pay off my mortgage? If it has ever happened to you, then you are not alone. Many people have to go through such troublesome situations many times in their lives. However, the kind of mindset they wear during these situations decides the quality of lives they get to spend. If you want to make sure that you don’t have to face any financial issue in the future, then try not to skip your payments now. It may seem easy and convenient at this moment, but it will spoil your image in the eye of country’s financial institutions forever. If you think they’ll never come across your deeds, then change that thinking right away. None of your acts go unnoticed in the eyes of the government.
Each time you skip a loan EMI, your credit score downgrades. When you do it repetitively, your credit score gets reduced to newer lows and damages your credit history, which is very tough to regain. In any case, the mortgage is for your own good. It helps you build a desired future for yourself and your family. So you’re just limiting your chances of giving your family the chance of living a happy life by not paying your mortgage EMIs on time. It’s not a good step.
Be regular with your mortgage loan and all other credit payments’ for that matter. Pay your EMIs on time and increase your credit score to explore better funding opportunities in the future. Keep in mind the points mentioned above to have a great experience going forward.
Author Bio – Schott has over 1.5 decades of experience in the mortgage industry. He likes to share his knowledge with online community from time to time.