If you have a credit score of 700 or around that number, it’s not bad, but there is certainly room for improvement too.
If you want to compare yourself to others as far as credit scores are concerned, your score of 700 would fall into the Good Credit range. Below is the range of credit scores:
- Excellent Credit: 750+
- Good Credit: 700-749
- Fair Credit: 650-699
- Poor Credit: 600-649
- Bad Credit: 300-600
You can clearly see that your score of 700 falls into the beginning of “good credit” range.
What Does A 700 Credit Score Get You?
You should be able to get most types of loans at reasonable interest rates with a score of 700. Many lending institutions will give loans out for people with fair and good credit, however they will do so at a higher interest rate to compensate for the fact that statistically, people with fair and poor credit are more likely to not pay back their loans, and they need to charge a higher interest rate to compensate for this.
Your score of 700 is a good place to be, but there can definitely be improvements. I think it’s a worthwhile goal to get your credit score to the Excellent rage. At this range, you should have no problem applying for any type of credit card. Many premium credit cards, especially the high end travel rewards ones require very good to excellent credit score to get accepted to them.
I’m a huge believer of maximizing rewards with credit cards. Hey… if you’re going to use credit cards, might as well get as much as we can from them, right?
Other types of loans like mortgages or car loans will also come at more favourable interest rates if you raise your credit score above 700.
Not only will you get better interest rates with a credit score above 700, you can also benefit from better insurance rates too.
So is a credit score of 700 good? I’d say it’s good. Not great. But good enough for most things. But you should absolutely try and get a credit score better than 700. It’s not too hard. I’ll explain more below.
A Credit Score Above 700 Should Always Be Your Goal
With a strong credit score, the following will benefit you greatly:
- You will get the cheapest mortgage rates when you purchase a home. This will save you thousands of dollars over your 30 years or so it will take you to repay back your home
- Applying for jobs will be easier because many employers perform credit history checks and with a great score, you will pass this portion of your employment check with ease
- Insurance rates can come at a cheaper rate. Insurance is all about risk, and when you show them you are good with credit, it shows that you’re a responsible person and it can help you secure cheaper insurance – and we all know how expensive insurance can be
- You can get the best credit cards in the world. Many high end credit cards are hard to get for most people because they don’t qualify. But if you have a high credit score (preferably above 700), you should be able to get virtually any credit card you want. Some of them have amazing bonus rewards for signing up. It would suck to miss out on them because you don’t qualify with a low credit score
- Getting vehicle financing can be very cheap, to zero! I remember applying for a Jeep Wrangler and being presented with a 0% financing option because my credit score was so amazing. Just paying even 2% over 6 years would have costed me roughly $800 more to buy the Jeep. Forget that! It really pays to get as high of a credit score as possible. I think 700 is just the beginning. You can do so much better than that!
How To Get Credit Score Above 700
I would say there isn’t any real magic when it comes to improving your credit score. If you have a score of 700 right now, you are already in a pretty good place. You are in a good range and should be able to get pretty much every type of loan you want, granted you qualify for it with your current income and debt ratio.
But there is so much more room to improve and why the hell not! Raising your credit score above 700 is one of the best ways to save money in the long run. Imagine paying 1% less on a mortgage rate over 30 years! It doesn’t sound like much, but this could save you $5,000-$10,000 or so over the life of your loan. That ain’t chump change.
I’ve had a pretty high credit score since I was young, and I’ve done it by doing the following things:
- Only buy what you can afford. You need to pay your credit card balance and any other type of line of credit balance off in full every month. If you can’t do this, make this your goal to reach. Not only will the weight of credit on your shoulders decrease, your credit score will get healthier when you pay back your revolving credit consistently every month
- Get as much credit as you possibly can. This sounds like a weird one, but a big part of your credit score is how much money you owe compared to how much money you can borrow. For example, if you had a credit card with a $20,000 limit and you have it near maxed out every month, your credit will suffer because your credit utilization is super high. But if that balance on your credit card is zero at the end of each month, then your credit utilization will be LOW and you will have a higher credit score. By getting MORE credit, you are basically keeping your credit utilization as low as possible, which helps your credit score.
- Use credit every month and use credit often. One of the best things you can do is SHOW lenders that you use credit often and also pay it back on time responsibly. That means use your credit cards every month and pay it off every month. It means getting a car loan or a home loan or any type of loan, and paying your instalment payments on time and in full. All of your payments will be kept on record and will greatly increase your FICO score over the years that you show you are responsible with credit. Also, a variety of credit will help improve your credit score too.
Getting a credit score above 700 isn’t complicated. It just takes consistency. And as time passes, like fine wine, your credit score will gradually improve.
If you have any questions, let me know in the comments below!