Table of contentsIs 700 a good credit score?Good range credit scores by ageGood range credit scores by incomeHow to get a 700 credit scoreHow to improve your 700 credit scoreStrategies to build 700+, 750+ credit score and aboveMaintaining a good credit historyWhat does a 700 credit score get you?Benefits from a good range credit scoreCan I get a mortgage loan with a 700 credit score?Can I get an auto loan with a 700 credit score?Can I get a credit card with a 700 credit score?
A 700 credit score is considered to be good. This means that you can get low rates on credit cards and loans. Lenders see consumers with scores in the good range as being "acceptable" borrowers and may offer them a variety of different credit products.
Let’s get started to understand what it means, what you can get with a 700 credit score and how to improve it.
Twenty-one percent of U.S. consumers have credit scores that fall into the "Good" range.
A 700 credit score is generally considered to be "good." This means that it should be relatively easy to get a mortgage, auto loan, or personal loan with a 700 credit score. Lenders usually prefer to do business with borrowers who have a good credit score because it is less risky for them. It gets even better: repairing your credit is one of the best ways to increase your score and unlock even better loan rates for you and your family. In other words, a 700 credit score indicates a good credit rating, many loan options, low loan costs, and minimal credit repair.
The average age of your credit cards and loans is one factor that is used to calculate your credit score. Therefore, it stands to reason that people with high credit scores are usually older. However, the fact that nearly one-quarter of people aged 18 to 24 have credit scores of 700 or higher should give newcomers plenty of hope.
People who make at least $50K per year are significantly more likely to have a credit score of 700 or above. And people who make between $75K and $100K per year are in the ideal range for a score that begins with a 7 or an 8. But it's important to note that it is possible to have a score of 700 or above even if you earn less money, or to have a much lower score even if you make a lot more money. It all depends on spending within your means.
Forty percent of consumers have credit scores that are lower than 700.
There is no one guaranteed way to achieve a specific credit score. However, you can aim to get within a general range. Keep in mind that there are different credit scores and definitions of good credit, but there are also some general principles that can help you build and maintain healthy credit. If you follow these principles over time, your credit scores will improve, and lenders will see you as a better credit risk.
Here are some practical tips to help you stay on top of the important factors that can affect your credit:
Your credit utilization rate is the percentage of your available credit that you use. It is generally recommended that you keep this number below 30%. This means that you should use less than 30% of your available credit at any given time. In general, the less available credit you use (while still maintaining consistent use to help keep the card active), the better.
If you check your credit reports and find that your credit utilization rate is higher than 30%, you have options for lowering it. For example, you could pay down debt or increase your credit limits. To increase your credit limits, you would need to ask your current lenders for a limit increase. However, be aware that this could result in lenders doing a hard inquiry on your credit when they make their decision.
Your payment history is a significant factor in your credit scores. How much a late payment can affect your scores varies depending on how late the payment is and how recently the payment was missed.
However, making payments on time consistently can help you build your credit, which could increase your likelihood of being approved for more credit if you need it in the future.
We would not generally recommend taking out a loan, which could be expensive, simply to improve your credit scores. However, having a mix of different types of credit can actually help your scores in the long run. Types of credit include revolving credit (such as credit cards) and installment credit (like auto loans and mortgages).
There is one potential downside, however: Applying for new credit can result in a hard inquiry on your credit reports, which can lower your scores. Although this impact is usually minor, too many hard inquiries in a short time can be seen as a negative by lenders. For this reason, it's crucial to have a sense of whether or not you're likely to be approved before applying for any new credit cards or loans.
The length of your credit history, or how long you have had active accounts open, can also affect your credit scores. A longer credit history can show lenders that you have more experience using credit.
If you have an expensive line of credit open (like a credit card with a high annual fee), you may be looking to close it. But closing a credit card can affect important credit factors like the age of your credit history, so carefully consider your options before cancelling a credit card.
A credit score of 700 gives you access to a wide variety of loans and credit card products. However, if you can increase your score, you may be approved for even more loans at more affordable terms.
Furthermore, because a 700 credit score is on the middle of the Good range, it is important to manage your score carefully to avoid dropping into the Fair credit score range (580-669), which has more restrictions.
Check your credit score regularly: It is advisable that you check your credit score on a regular basis. Doing so can give you helpful information and feedback as you strive to improve your credit score. Please keep in mind that it is not unusual for your credit score to fluctuate from time to time, and what you should be looking for is a general trend of improvement as you maintain good credit habits. If you would like to automate this process, you might want to look into a credit-monitoring service. Additionally, there are identity theft protection services that can monitor your credit reports for suspicious activity and alert you if any is detected.
Avoid high credit utilization rates or debt usage: It is best to avoid high credit utilization rates or debt usage. Try to keep your utilization across all your accounts below approximately 30% to prevent lowering your score.
Seek a solid credit mix: It is prudent to seek a solid mix of credit, including revolving credit and installment loans. No one should take on debt they do not need, but borrowing can promote good credit scores.
According to data from credit reports, 31% of people with a credit score of 700 have at least one late payment (past due 30 days) on their record.
Pay your bills on time: It is important to pay your bills on time if you want to improve your credit score. Find a system that works for you and stick to it. Automated tools such as smartphone reminders and automatic bill-payment services can be helpful for many people. Others may prefer to use sticky notes or paper calendars. After six months or so, you might find that you don't need any help remembering to pay your bills. (Even so, it's probably a good idea to keep using the system, just in case.)
If you have a good credit score (700 or above), you likely already practice good credit habits. But did you know that a very good credit score (740 and above) can help you get the best interest rates? The good news is that if you're already in the good range, it doesn't take much to improve your credit score even further. Here are some things to keep in mind:
One late payment can have a significant negative impact on your credit score. To avoid the risk of making a late payment, you may want to set up automatic payments for your credit cards and other bills. For a credit score of 750, an "A" grade indicates that all payments have been made on time.
For a 750 credit scorecard Debt Load, a grade of "A" means less than a 0.28 debt-to-income ratio.
It's a good idea to keep your credit utilization at 30% or lower. This is because people with the highest credit scores typically have utilization rates below 10%, according to VantageScore. If you want to improve your credit utilization, you could either ask your credit card issuer for a higher limit or open a new credit card. Just be careful not to increase your spending, or you'll cancel out the benefits of having a higher overall credit limit. Utilization rates between 1% and 10% are considered excellent and usually result in a 750 credit score.
By Collections Accounts and Public Records, a credit scorecard for someone with a credit score of 750+ grade A means zero collections accounts and public records.
The longer you have been using credit, and the longer your average age of accounts, the better it is generally for your score. Remember, credit scores are designed to estimate your risk as a customer, and a long history provides more data to base that estimate on.
Unless there is a pressing reason, like a high annual fee, avoid closing credit cards. You can also look into doing a product switch to a more suitable card from the same issuer. On the credit scorecard for account age, a grade "B" means that the average account is less than 9 years old.
When you apply for credit, there is likely to be a hard inquiry on your credit record. Each of those can take a few points off your score temporarily, so it is best to space out applications by about six months. The credit scoring card for hard credit inquiries grade "A" means fewer than 3 in the past 24 months.
It is better for your credit score to have a mix of installment loans (with fixed payments for a set time) and revolving credit (like credit cards). The credit scorecard for 750+ credit score for account diversity grade "A" means 4+ account types or 21+ total accounts.
The average American consumer has a good FICO® score. With some time and effort, you can increase your score into the Very Good range (740-799) or even the Exceptional range (800-850). Moving in that direction will require an understanding of the behaviors that help grow your score and those that hinder growth.
Late and missed payments are among the most significant negative influences on your credit score. Lenders want borrowers who pay their bills on time, and those who have missed payments in the past are more likely to default on debt than those who pay promptly. If you have a history of making late payments (or missing them altogether), you can improve your credit score significantly by kicking that habit. More than one-third of your score (35%) is influenced by the presence (or absence) of late or missed payments.
Usage rate, or utilization rate, is a technical way of describing how close you are to "maxing out" your credit card accounts. You can measure utilization on an account-by-account basis by dividing each outstanding balance by the card's spending limit and then multiplying by 100 to get a percentage. Find your total utilization rate by adding up all the balances and dividing by the sum of all the spending limits:
|Balance||Spending limit||Utilization rate (%)|
Credit history: Although other factors play a role, your credit history is the biggest determining factor in your credit score. If you have a long history of managing your credit well and making payments on time, your score will likely be high. On the other hand, if your recent credit history is bogged down by late payments or high utilization, your score will suffer. There's not much you can do about it if you're a new borrower. But if you manage your credit carefully and keep up with your payments, your credit score will tend to increase over time. Age of credit history is responsible for as much as 15% of your credit score.
Applying for new credit or taking on additional debt can have a short-term negative effect on your credit score. This is because credit-scoring systems view you as being at greater risk of not being able to pay back what you owe. Your credit score may dip slightly when this happens, but it will usually rebound within a few months as long as you stay up-to-date with your bill payments. Because of this, it's generally a good idea to space out applications for new credit by six months or so. It's also advisable to avoid opening any new accounts in the months leading up to when you plan to apply for a major loan, like a mortgage or car loan. New-credit activity can make up for 10% of your overall credit score.
Although public records like bankruptcies don't appear in every credit report, they can still have a major impact on your credit score if they're listed. In fact, one or more bankruptcy entries can outweigh all other factors and severely lower your score. For example, a bankruptcy can stay on your credit report for 10 years, which may prevent you from getting access to many types of credit during that time.
Having a variety of different types of credit accounts can help improve your credit score. The FICO® credit scoring system gives more weight to individuals with multiple credit accounts, including both revolving credit (accounts such as credit cards that allow you to borrow against a spending limit and make payments of varying amounts each month) and installment loans (e.g., car loans, mortgages and student loans, with set monthly payments and fixed payback periods). Credit mix accounts for about 10% of your credit score. So if you want to improve your credit score, it's worth considering diversifying your credit portfolio.
40% of Individuals with a 700 credit score have credit portfolios that include auto loans and 29% have a mortgage loan.
|Item||Does 700 credit score qualifies?|
|No annual fee credit card||Yes|
|Credit card with 0% financing||Yes|
|Favorite store’s credit card||Yes|
|No-foreign-fee credit card||Yes|
|Airline/Hotel credit card||Yes|
|Initial credit card bonus||Yes|
|Any credit card||No|
A credit score that falls within the "good" range may reflect a shorter credit history with good management. Alternately, it may represent a longer credit history with a few mistakes, such as late or missed payments, or relatively high credit usage rates. Lenders tend to see people with scores like yours as good prospects for the business. Most lenders are willing to extend credit to borrowers with credit scores in the good range, although they might not offer the best interest rates. Similarly, card issuers may not offer the most compelling rewards and loyalty bonuses.
Consumers with 700 credit scores have an average of 4.4 credit card accounts.
If you have a 700 credit score, you should be able to get a mortgage or home loan without too much difficulty. Your current score is a good credit rating, and there are multiple types of FICO scores. While mortgage lenders don’t usually work with the same one that’s used to make most lending decisions, they can still consider you for a loan. A 700 credit score is also good enough to buy a house. You can even find lenders that will consider you for higher-value homes requiring “jumbo” mortgages. Your credit score is just one of many factors that determine mortgage interest rates. Getting a good rate can save you many thousands of dollars over the life of your loan.
If you have a 700 credit score, you may be wondering if you qualify for an auto loan. The good news is that your credit score is relatively cheap, which means there isn't as much risk for the car lender. This means you're likely to get approved for a loan with a decent interest rate. When it comes to auto loans, people with good-to-excellent credit typically get the best rates. But what counts as "good" credit can vary from lender to lender. Beyond the base credit-scoring models like FICO and VantageScore, there are also industry-specific scores that lenders could check, such as FICO® Auto Scores. So as you research the best credit card for your needs, pay attention to the score required. Since each application can temporarily nip a few points off your score, you want to make sure you're likely to be approved before applying. But if you have a 700 credit score, you should have plenty of choices when it comes to credit cards.
If you have good credit scores, you may qualify for some great credit cards with perks like cash back, travel rewards, or 0% APR for a limited time. However, the very best and most exclusive credit cards may still be out of reach if you only have "good" credit. You may need excellent credit to be approved for these cards, so there's still room for improvement. With a credit score of 700, you would still have access to travel rewards credit cards, though you usually need an excellent credit score to get a luxury credit card. You can get even better terms on your loan or credit card by repairing your credit and waiting a few months for your score to improve. A 700 score means you likely have a few negative items on your report. Removing any outstanding negative items (or hard inquiries) is usually the quickest way to fix your report.
Share this article