Most people only think of improving their credit score when they want to apply for new credit such as for a house or car loan. What many people fail to realize is that poor credit can affect your current status and not just your future ability to gain new credit. Many companies that you continually do business with, or have a line of credit with make periodically check your credit report. When they do, if they notice that your credit score has fallen, they may make adjustments to their business relationship with you as a result. This is entirely independent of any payment history that you may have with that company. For instance:

Your credit card company may raise your interest rate due to a lower credit score even if you make your payments to them on time. This is often included in the terms and conditions that are provided when you accept the card, though many people do not realize that until after they are slammed with higher fees.

Businesses may shorten or eliminate any grace periods you have for payment if they notice late payments to other companies. This is because you become a greater risk for payment based on their own internal credit policies. What this means to you is, when that 30-day grace period evaporates, you are suddenly reported for being late on payments that were considered on time before.

Your insurance rates may increase as a result of lower credit scores; some unscrupulous insurance companies may even attempt to cancel your policy. Higher rates will show up at policy renewal as you are moved into a new risk class with the company. Cancellation of your policy may be enacted due to only one missed payment and without notice if your credit score is deemed too low.

Many companies run a credit check on prospective employees, and do not hire prospects with scores below a certain level. This can be for many reasons, but often companies site that individuals with poor credit often have issues that cause distraction and poor employee performance.

If you work in a company that requires a security clearance lower credit scores can endanger your employment as you are considered a greater risk to security if you have a low credit rating. People with jobs that require security clearance are continually evaluated on a number of factors, and their credit score is one of those.

As you can see, there are numerous ways in which a poor credit score can affect your life in the here-and-now, not just the future. With the current problems in the financial sector, these issues can only be expected to worsen as banks are forced to restrict their lending and credit lines to those who have excellent credit. Poor credit can cost you hundreds or even thousands of dollars in rising interest rates, higher premiums, and shorter payment cycles.

Because credit and credit ratings are used so often in our society, credit management services are becoming more popular with all individuals, not just those with poor credit ratings. Improving your credit score will not only help with getting future lines of credit for a big purchase such as a mortgage or car, but it can also help to improve your current credit situation as well.