About| Property Search| List Property| Advertise| Contact

RSS Feed Twitter YouTube LinkedIn Facebook Pinterest G+

What is a Good Credit Score and How to Fix it?

by Marquette Turner Luxury Homes

in Features, Money & Business, Variety

Financial wellbeing is an essential component in living the life you always envisioned for yourself. There’s no better feeling that having control over your finances and knowing that your efforts to maintain a good credit standing has helped you achieve life milestones, like receiving approving for a student loan, getting a mortgage for a home, or landing a new job. 

What’s more, you can accomplish these goals without the headache-inducing stress of having applications denied, accumulating fees, or being quoted high-interest rates. 

What’s the Definition of a Good Credit Score?

In the US, FICO and VantageScore using a sliding scale ranging from 300 to 850. To fall into the “good” credit score category, lenders typically want to see a minimum score of 690. Scores that land above the 720 mark are considered excellent. 

According to an Austin credit repair company, mortgage providers and credit card issuers typically possess their own set of standards of what constitutes as good credit. Because of this, each lender has the power to determine whether they’d like to extend you the credit and what type of interest rate you’ll receive.

Photo by Stephen Leonardi on Unsplash
Photo by Stephen Leonardi on Unsplash

What Can Good Credit Get You?

When you have good credit, it communicates to lenders that you are financially responsible. In addition, it is a large determining factor in whether or not your loan will be approved and what type of interest rate you will receive along with it. 

Among the many things a good credit score can get you, includes:

  • A low-interest mortgage
  • An unsecured credit card or a balance-transfer card (accompanied by a decent interest rate).
  • A desirable apartment lease or car loan
  • Lower insurance premiums 

Believe it or not, many landlords will pull your credit score as a means for screening whether or not you’d be a good tenant and pay rent on time. Some employers also look at your credit standing as a component of their hiring process – meaning bad credit could cost you the job. 

So:

Even if you’re not planning to apply for a new loan or credit card, having a good credit score is pivotal at determining your financial responsibility. 

How to Boost Your Credit Score

When good credit habits are practiced consistently, it’ll help you build upon your credit score and enjoy the benefits of increasing your credit standing. Here are some tips and tricks on how to exercise financial responsibility and ensure your credit score remains in good standing:

#1: Always pay your bills on time. Your payment history is one of the largest influential factors on the health of your credit score.

#2: Make an effort to keep the balance on your credit card low. The general rule of thumb is to remain under 30% of your total allotted balance at all times. This is often referred to as credit utilization and is the second biggest determining factor of how good your credit score is.

#3: Strive to keep your credit accounts open. Unless a compelling reason arises for closing the account, such as incredibly poor service or high fees, you should keep your account open. Why? Having older lines of credit helps raise the average age of your credit history. Additionally, whenever you close an account, it’ll decrease your overall credit limit, which will have a corresponding impact on your credit utilization.

#4: Steer clear of opening many credit applications in a short period of time. Whenever a lend performs a credit check, it can cause a minor, temporary dip in your credit standing. When you have several lenders evaluating your credit report, it can add up rather quickly.

Make sure you constantly monitor your credit reports, so you can dispute inaccurate information – which will help raise your score. As you can see, your credit score can play an important role in your life and a good credit score provides you with financial freedom. Who doesn’t want that? 

Consider saving this article for future reference so you are always in the know about what is a good credit score and how you can fix it if needed. 

Leave a Comment

Previous post:

Next post: