Mortgage Applicants: Bad Credit Can Cost You. Big.

You are probably well aware that a poor credit score costs you money.

You are probably not aware how much money it add up to over time.

Try $1 million.

For people with poor credit, additional money they will have to pay for things like a home loan, car loan and insurance, compared with what those with solid credit pay, can be in the mid-six figures over a 30-year period.

Invest it wisely, and that number could soar over $1 million.

Bad credit costs you in more ways than you imagined.

The most glaring and drastic way, of course, is through the home mortgage you apply for and receive.

What kind of mortgage rates will you get? It depends.

The most obvious place that bad credit hurts you is the interest rate you must pay when you get a mortgage to purchase a house. The average price for a home in the U.S. in June 2007 was $316,200.

According to MyFico.com, a 30-year, $300,000 mortgage for an applicant with a credit score of between 760 and 850 carried a 6.346 percent home loan rate.

Someone with a credit score of between 500 and 579, meanwhile, would be in the zone known as bad credit mortgage territory - and have a 10.152 percent rate.

That would mean that a person with a good score would have a monthly payment of $1,866, while the person with the poor credit score would pay $2,666 - or $800 a month more for the same house.

That adds up to $288,000 over the 30 years of the mortgage.

And that’s just on the surface. If a person with good credit took the gap between the two and invested the difference in an account that earned even a modest 5 percent annually, the yield could net you six figures.

Follow the link to continue reading this article by TheSteet.com and Yahoo! Finance on the adverse impact of bad credit and mortgage rates …