A good credit score opens up many financial doors. Good credit is the key to getting a loan, such as a home mortgage, an auto loan, or a student loan. In addition to being the main qualifier for a loan, your credit level also determines what kind of interest rate you can get on said loan. Generally, the higher your credit, the better your interest rate will be. Your credit is also something taken into consideration when renting an apartment or even sometimes when applying for a job.
So, why does good credit help you get better loans and a better job or apartment? Essentially, good credit makes you look financially responsible. With good credit, you seem like a safe investment to lenders, as well as a responsible potential tenant or employee. On the other hand, bad credit can make you look like a risky bet. So, making sure you have good credit can make sure you have fewer financial roadblocks.
Taxes and Your Credit
Not everyone knows that their taxes could affect their credit score, but they can under certain circumstances. If you have unpaid taxes, you could get a tax lien, which would immediately show up on your credit score. A tax lien is a formal legal claim that the government owns your properties or assets due to unpaid taxes.
A tax lien is a major negative mark on a credit report. Because it is what is known as a public record mark, it is weighted heavily and lowers your credit score significantly. Tax lien debts must be paid to the IRS to have this mark taken off. But the record of a tax lien on your credit report does not necessarily disappear after the debt is paid. A paid tax lien can stay on your credit report for 7 years after payment. This is why it’s important to know if the mark is there, whether the debt is paid yet or not, so you can take the appropriate steps to get it removed.
If you have a tax lien notice on your credit report, you can get help from one of our experts today. Vanguard Tax Relief can save your credit by helping you fix your back tax issues and getting your tax lien lifted. We’re experienced in getting tax liens removed and can get yours lifted as quickly as possible. Contact us today to resolve your back taxes and start getting your finances (and your credit score) back in shape.