Don’t Be Fooled By Your Excellent Credit Score
It’s The Bank Gaslighting You
Looking for your dream house? Yep. A fancy car? Yep. Another credit card? Yep. Maybe a personal loan for a wedding? Yes, please.
An excellent credit score means you can borrow money at a cheaper interest rate. It shows the banksters that you are an excellent borrower i.e. you make all your monthly payments as scheduled, don’t miss any and are generally a trustworthy individual (fiscally speaking).
So why be wary of an excellent credit score? Well, let’s look at it from a lender’s perspective.
Deposit At 0%, Lend At 23%
You know what the bank does with your money in it’s coffers? Pays you 0% on it. Instead, it lends it out as loans to other customers and charges them up-to an eye-watering 23% for it (typical credit card APR). The more of your money you put in the bank, the more the bank can lend, the more it can earn from.
That’s arbitrage. And the bank milks it.
Imagine what could be if you cut-out the middle-man (the bank) in this scenario and instead lend your money directly to perspective borrowers for, I dunno, 10%? Everyone, except the bank, wins. But that’s for a different day.
