What is a Good Credit Score: Most of you must have heard the term “Good Credit Score” when applying for the mortgage. But you don’t know the exact meaning of the Good Credit Score. The credit score is the simply 3 digit number. Different lenders use various scoring methods to measure the credit score of their customers. The borrowers should pay off the amount of the mortgage within the time to get the Good Credit Score.
Most credit scores usually fall between 600 and 750. The credit score above 700 is considered as the Good Credit Score. But if you have the credit score more than 750 then it will the Best Credit Score. The average credit score is about 690. So, if you have a credit score above 690, then you will be included in the category of good credit score.
On Which Factors The Credit Score Depends Upon
The credit score is calculated by keeping in view the many factors. The factors that have an effect on the credit score of borrowers are given below:
- The late payment of the loan by the borrower.
- Types and number of accounts that the borrower has.
- The total debt also has the little bit impact on credit score.
- The credit score also depends upon the public records of the borrower.
The good credit score has no impact of the following elements. It does not depend on the age of the borrower. The salary, occupation, approval and also the employment of the borrower have no effect on the credit score. It only helps the borrowers in the approval of loan application. It also does not consider the color, religion, race or nationality of the applicant.
Benefits of Good Credit Score
Having the good credit is like the blessing of God. Borrowers having the good credit score will be rewarded on their each step. The benefits of the good credit score are as follows:
Increased Credit Card Limits
The borrowing capacity of the borrowers will be increased due to their good credit score. High credit score shows that the borrower is very responsible and can deal with the more credit. The credit card limits of such borrowers are automatically increased by the lenders. This is the one of the major advantage of the good credit score.
Low Interest Rates
The low interest rates of the mortgages depend upon the credit score of the borrowers. The higher the credit score of borrower, low interest rate the borrower will get.
Perfect Credit Card Deals
The borrowers having the good credit score can easily qualify for the best credit cards. The best credit cards provide various offers to their customers such as rewarding points, low introductory rates and also free gifts.
Improving Credit Score
If your credit score has not yet crossed 700, then you should think about the improving your credit score. Even if you have the credit score of about 720, then you can also follow these steps to improve your credit score:
- Pay off the loan within the time.
- Also Pay other bills before due date.
- Eliminate credit card balances from various credit cards.