Credit Score Definition

What Is An Excellent Credit Score And How This Can Be Helpful For You?

Written by Brian James

To know what is an excellent credit score, you must first understand how a credit score is represented and why you need one. As the name implies, the credit score is a rating and is represented by a numerical value. The credit report is the most vital parameter used to calculate your credit score. This is a value between 300 and 850 and assesses your credit worthiness. You must try to keep your credit score rating as close as possible to 850 for it to be considered an excellent credit score.

Ideal Range

The ideal score range for an excellent credit score is above the 720 to 730 mark using the FICO Score or ranges from 900 to 990 using the Vantage Score. If your Vantage credit score shows an A rating, then your credit score is really excellent.

Getting a range of 800+ on the FICO and achieving a really good credit score is a matter of accomplishment that can be achieved with time and dedication. It does not make any difference to the interest rates that you will be levied if your credit score lies anywhere in the ideal range. According to a study in the US, only 13% of people have been able to achieve this. Most money lenders check on your FICO credit score when you need to take money on credit.

How to Get

There are no shortcuts to obtaining what is an excellent credit score. You must make your payments on time without defaulting them. This ensures that the balance on your credit cards is as low as possible. Apart from this, the pending debts you have to clear must be really low which in turn can help to assure you of moderate credit. It is also important for you to scrutinize your credit history periodically. This can help you watch out for unexpected red flags and take appropriate action. Following all these steps systematically can help you work towards achieving this. Thus, this is not an overnight achievement. However once you achieve an excellent score range, you must continue maintaining this score. Maintaining a once received excellent score is not as difficult as getting a new one.

When you try to get an excellent credit score, you must have a variety in the type of credit lines that you keep open. Too much of credit of the same type can affect the score rating. For example, a person with outstanding credit on five credit cards has lower chances of getting a better credit score compared to a person with outstanding credit on two credit cards, a mortgage an auto loan.

What You Should Know

Having a very good credit score can assist you with availing credit when you want some and can also get you some of the lowest and best interest rates. While this is one of the key parameters, a really good credit score is not the only parameter in helping you with the credit or loan that you need.

When you work towards achieving a really good credit score, you must remember to keep in mind that you have three credit scores to be concerned about. These three credit scores are obtained from the three key credit reporting bureaus in the US. You must achieve an excellent credit score from each of the three agencies. Often, people get excellent scores with one or two agencies and just an average or good score with another.

About the author

Brian James

US Financial specialist with a financial Master degree. Speaking about credit scores range in US, credit cards and more.

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