In the world of credit, you have a three-digit number that can have a significant impact on your ability to borrow money at low interest rates. That number is called your credit score, and the higher your score, the more the lenders see you as an ideal borrower.
What’s the Threshold of a Good Credit Score?
Most lenders put the cutoff for a good credit score at 725. Anything above that is good to excellent, whereas anything below that is fair to poor. Because the credit score scale goes all the way up to 850, there’s plenty of room in the good credit score range, and you can have a good score even if you have had one or two missteps in your credit history.
How Can You Earn a Good Credit Score?
The most important thing you can do to improve your credit score is to pay your existing loans and credit cards on time every month. You can also decrease your credit card utilization, which is when you reduce your balance to only a small percentage of your credit line. Having a long credit history with many different types of credit and not applying for new credit very frequently also help. If you aren’t sure where your credit score stands, get your free score from us at CreditNowUSA and sign up for credit monitoring to see how it changes. We can also help you improve your score if it isn’t as good as you want it to be.
What Does a Good Credit Score Get You?
Lenders use credit scores to evaluate each borrower’s risk. A borrower with a low credit score is a high risk because he has not shown a consistent history of making payments on loans, whereas a borrower with a high credit score is a low risk. Lenders use risk to set the income they need to get from the loan to make it worthwhile for them. In short, a good score will earn you a lower interest rate than an average or bad score.
For more information, go to Credit Score at http://www.creditnowusa.com/Credit-Score