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What is a Good Credit Score ?

Is 700 a Good Credit Score? This is a common question what score is considered worthy of good rates and terms? Typically Scores range between 300 and 780. There are scores that get into the 800's but you typically don't get that high unless you are in your 50's with low debt. There is a time factor in the calculations for having a score that high. You need to be around a while before it happens. You also need to have a excellent credit history with very little debt. So what are lenders looking for to consider your credit risk low? Here is the break down of what goes into the Credit Scoring process.

What goes into a score?

The basic credit scoring formula takes into account several factors from your credit report. The impact of each element fluctuates based on your own credit profile:

* Payment history � A good record of on-time payments will help boost your credit score.

* Outstanding debt � Balances above 50 percent of your credit limits will harm your credit. Aim for balances under 30 percent.

* Credit account history � An established credit history makes you a less risky borrower. Think twice about closing old accounts before applying for a loan.

* Recent inquiries � When a lender or business checks your credit, it causes a hard inquiry and a slight ding to your credit score. Apply for new credit in moderation. "Soft" inquiries such as pre-approved offers or checking your own credit score will not impact your score.

* Types of credit � A healthy credit profile has a balanced mix of credit accounts and loans.

When creditors look at your credit report, you really should have at least a 660 credit score so you will not get gouged with high interest rates. Most lenders will charge higher rates when your scores are lower than a 660. You typically can get loans when you scores are lower, but your rate of interest will be higher. If you stay on top of you personal Credit Report you really should have a credit score of 720 or above. If you are not sure what your score is you really should get a copy of your Free Credit Score Report. So a Good Score is 660 or above. If you stay above that threshold you should be fine with just about any application With a 720 score you will typically get the best rates and terms. Good Luck.

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About the Author: Mike Clover is the owner of http://www.my720fico.com . My720fico.com is one of the most unique on-line resources for free credit score reports, Internet identity theft software, secure credit cards, and a BlOG with a wealth of personal credit information. The information within this website is written by professionals that know about credit, and what determines ones credit worthiness.

This article is free for republishing
Source: http://www.articlealley.com/article_255506_19.html


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