A Good Credit History Can Save You Hundreds Of Dollars On Your Car Insurance

When you go down to get car insurance, you want to get the best deal and the lowest auto insurance rates that you can. There are some facts about your credit score and credit history that may cost you more in car insurance premiums, and this does not just include your credit score. Insurance companies use a number called an insurance credit score. This score takes into account the actual credit score on record, but also a number of other things that affect your rates as well.
Public records may be checked for any liens, foreclosures, bankruptcies, collections, judgments, and charge offs. Keeping these items off of your public record will give you lower insurance rates with most auto insurance providers. Past payment histories may also be checked, and for more detail than just how many times you have been late, including how many days you were late each time. Make sure that you make your payments on time every month to keep car insurance costs low.
The total length of time you have had a credit history can be a factor in your car insurance costs, so if you do not have credit then apply for some to get in the system. Sometimes not having any credit at all is just as bad as having poor credit, so use your credit wisely, but at least establish it and you can get lower car insurance premiums.
Many auto insurance providers will check the number of inquiries for credit when they determine the rates for your auto insurance policy. Insurance companies will look at factors including any new applications for car loans, personal loans, mortgages, credit card accounts, and utility accounts as part of this specific check. Do not apply for credit just because you can, or it could end up costing you more for your car insurance.
The lines of credit that you have open and the types of credit that you use are both usually considered when an auto insurance company determines your risks and your car insurance rates. The credit cards you have will be considered, whether you use the credit cards or not. Only keep credit cards that you use, and close any card accounts which you do not want or need. Only apply for and use the credit that you have to, because these factors will reflect on your auto insurance bill.
The last area of your credit history which will have an effect on your auto insurance costs is your used/available credit ratio. The amount of credit you can use is compared to the credit you actually use, and the lower the ratio is the better your car insurance costs will be.
Knowing all of the areas of your credit history that will be evaluated by the car insurance companies can help you lower the risks involved in these areas, so that you will get great car insurance rates and see substantial savings. If you pay attention to these areas of your credit history, you will get lower car insurance rates on your policy.