Home Loan 700 Credit Score, Good or Bad?

700 Credit Score, Good or Bad?

A credit score of 700 falls within the acceptable range. Low rates can be expected on loans and credit cards.

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700 credit score is considered to be a good credit score in the most common credit score range (300-850).

What is your score relative to others?

You fall within the range of 690-719 for good credit scores.

According to FICO credit scoring company, your 700 score is higher than 37.2% of consumers.

FICO reports that 16.4% of consumers scored scores between 700 and 749 by 2021.

Strategies to increase your 700 credit score

Your 700 credit score is likely earned through good credit habits. However, there are many ways to improve it.

A high score of 720 or more can help you get the best rates. It doesn’t take long to improve credit if you are already in the good category.

These credit score factors are important to consider:

History of payments

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One late payment can have a devastating effect on your credit score. To avoid late payments, set up autopay for your credit cards and other bills.

Credit utilization

Credit utilization is the amount of credit you have available.

Try to use 30% of your card’s credit limit. Lower is better. VantageScore, which is the main competitor to FICO, states that consumers with high scores use less than 10%.

Ask your credit card provider for a higher limit, or open a new card. You should not increase your spending, or you will lose the benefit from a higher overall limit that reduces your utilization.

Credit history length

Your credit score will improve the longer you have been using credit and the older your average age of accounts. Credit scores are used to assess your risk as a customer. A longer credit history provides more information to help you make an estimate.

If you have to close your credit card, don’t do it unless there is a compelling reason such as a high annual charge. Another option is to switch products from one issuer to another.

Credit applications

There will likely be a hard inquiry about your credit every time you apply for credit. You may lose a few points temporarily due to each of these inquiries. Therefore, it is advisable to spread out your applications for at least six months.

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Credit mix

A mix of installment loans with fixed payments over a period of time and revolving credit such as credit cards will improve your credit score.

How 700 credit scores can help you

Lenders use your credit score to determine if you are eligible for financial products. They also set the interest rate that you will pay.

You’re now in the “good” credit category with a credit score of 700. This allows you to get lower rates on financial products such as loans and credit cards.

Car loans

Experian’s 2021 report revealed that nearly 65% of car loans were made to borrowers with 661 credit scores or higher. For buyers within the 661-780 range, the average interest rate for a new car was 3.488% and 5.49% respectively.

Home loans

You can also buy a house with a 700 credit score. Lenders will even consider you for “jumbo” mortgages, which are higher-value properties that require a larger loan amount. The rate of your mortgage interest rate will be determined by your credit score. A good rate could save you thousands over the term of your loan.

Credit cards

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Pay attention to the required score when you are researching the best credit card for you. Each application will temporarily lower your score so make sure you are likely to get approved. You should have many options for credit cards to meet your 700 scores.

Personal

A higher credit score, like other loans, will result in a lower interest rate. For any personal loan that you are considering, make sure to check your minimum credit score.

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What happens to a 700-point score that has a late payment?

It is important to remember that late payments of a few days are not necessarily a problem. You may be charged a late fee or your credit card issuer might raise your interest rate.

But, letting a bill get 30 days late or more can cause your credit score to plummet: One missed payment can cost you 100 points, especially if it is a good one.

Your credit score and other factors will determine the exact amount of loss you may experience. However, it is likely that you will suffer some damage so be aware of this important scoring factor.

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