I have pretty good creditright now my score is close to 800.
Sure, except that awesome credit has actually been pretty useless, even when I recently bought a home.
Dont get me wrong,bad credit has a big impact on your finances.
Its strange, then, that excellent credit doesnt really matter.
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The whole idea of credit scores is flawed to begin with.
We tell people theres this single number to judge their financial worthiness.
Thats a scary prospect.
In reality, thereare actually many credit scores, not just one.
Banks use theirown scoring system to approve or deny your applications, for example.
Now, Im not suggesting credit doesnt matter at all.
It sure as hell matters when its bad.
Fine, lets say thats fair enough.
It doesnt work that way, though.
The Few Perks of Excellent Credit
Alright, maybe Im being a little cynical.
For example, I can easily get approved for huge lines of credit.
I get a higher limit to improve my credit…for what?
An even higher limit I wont use?
And if Idouse that, my score drops, making the whole perk pointless.
Its like having a phone that only calls itself and also stops working if you actually use it.
Again, that doesnt really matter if youre not in debt.
You dont need an excellent score.
You just need a score thats good enough.
His score is like, 100 points lower than mine, though.
You dont consider mine at all?
No, not really, our lender said.
We tried to get around this with my name only on the loan.
It didnt, though.
Our rate together with mediocre credit: 4.8%.
The rate on my own with excellent credit: 4.2%.
The same goes for the Honda Civic.
When my fiance leased his C-Max, we found the same thing.
When haggling with the dealership, they said his 700 credit score might work against him with the financing.
So we called them out and said wed put my name on it instead and use my 800 score.
They relented and admitted that the rate would actually probably be the same.
Bottom line: excellent credit has served zero purpose in my life so far.
Otherwise, youre wasting your time.
So gaming it doesnt help anything but your ego.
You will always be offered the best borrowing terms.
Excellent creditmightget you a lower mortgage rate, but bad credit willdefinitelyget you a terrible rate.
In other words, when it comes to credit, theres little point in striving for excellence.
Youjust need to strive for not bad.
Illustration by: Angelica Alzona
