What is a Good Fico Credit Score?
A good FICO score is one that exceeds 700. Any amount above that number is generally sufficient to qualify for the lowest available rates on most types of loans, but it is not a one way ticket to being able to take out extraordinarily large loans-your income will have a more significant effect on that.
Maintaining good credit can be even more challenging than building it up. When your credit score gets that high, even a single error in bill payments, such as a 30 day late, can send the score dropping with stomach-churning speed. If you are afraid of losing your credit score, it can be a good policy to set up automatic bill payments for all of your obligations to ensure that everything is paid, even if you don’t remember to do so. This requires that you maintain an adequate bank balance, but also eliminates the risk of human error.
Request regular detailed credit history reports. This will allow you to correct any errors as they happen, rather than later. Order credit reports either every month or every three months so that you can ensure the information is reported accurately. If you need to dispute an item, have all the relevant paperwork in your possession before you contact the credit reporting agency. You can even sign up for the myFICO program via the company’s website. The service provides instantaneous updates on your credit report.
Once you have a good FICO score, many options open up to you that would not be available otherwise. It’s far easier to start a business if you have a good credit score, as it gets you access to many low interest small business loans. If you invest, it makes it far easier to get personal loans that you can use to leverage your investments. It also becomes far easier to get approved for low interest mortgages and car loans. The best credit card rates become available to you as well.
If you have managed to get your credit score above 700, there isn’t much need to work very hard to push it much higher. Once your score exceeds 775, the vast majority of lenders will not treat you differently no matter how much you improve your score. If you want to improve your attractiveness to lenders, it would be wiser to expend effort to reduce your debt to income ratio or to pay down existing debts.
Individuals with a good credit score get access to credit cards with very high limits and very low interest rates. In addition, these cards have the best reward programs available that are easier to take advantage of thanks to the low interest rates. Credit card companies virtually never reduce the credit lines of customers with good credit, helping to increase your ability to plan for the future. This creates further incentives for you to continue using credit cards, even as you have likely demonstrated your ability to pay off your balance in full every month. Platinum credit cards available to people with good credit scores often also have additional perks, like airline club membership, discounts to many restaurants and special deals on a variety of consumer products.