Your credit score is considered one of the most significant digits in your financial world. Depending on the amount and purpose of the loan and your credit score, you can decide whether you are eligible for a loan and what interest rate you will have to pay. Now can one say that a credit score of 700 is that of a bad credit? Or has it remained honorable?
Credit Score: What Does a 700 Mean?
FICO scores are normally distributed between the scale of 300 and 850. The higher the score the better, this is because higher scores will enable the company to increase its revenues by expanding the number of customers it serves. More specifically, Good credit, as classified by Experian, ranges from a score of 700 to 749. A positive credit report also means that banks and other lenders view you as a responsible credit user who pays back the borrowed amount in full and on time.
It is not the highest score but it is above average; thus, a 700 credit score will still enable you to secure a great loan and interest rates provided that your financial status is also sound. The rates of funds are best for people with scores of 700 and higher. But 700 is the initial step to what can be considered a ‘good’ or a favorable score.
Here's how different credit score tiers shake out:
300 to 579: Bad
580 to 669: Fair
670 to 739: Good
700 to 749: Good 750 to 799: Very good
800 to 850: Exceptional
What about 700? In reality, it is also considered ‘good,’ but how beneficial and credible is this score when it comes to loan approval and interest rates? I would like to examine it in greater detail, so keep on reading.
Listed below are some of the benefits of a 700 credit score:
While not perfect, a credit score of 700 still provides quite a few key advantages, including:
1. Loan Approval
If you are 700 then you should be able to secure almost all the loans you want provided your debts are in check as well. This is because, to lenders, you are perceived as a relatively safe candidate in terms of the probability of repaying the loan you have been granted. It’s just not at the rates that are given to individuals who have a FICO score above 750.
2. Lower Interest Rates
Credit applicants with a credit score of 700 can obtain average or even below-average interest rates with most of lenders. For those customers with perfect credit, that is, with scores that are above 760, they get the very best rates; however, even those who have a credit score of 700 are not so bad off. The interest charges vary depending on the type of loan facility, the amount being sought, and general economic factors. However, you will do better than if your score was 650 or lower For instance, I expect to score 750 in the test.
3. More Credit Opportunities
The fact is that no one dreams of getting a loan for people with bad credit ratings – all the doors are open only for individuals with good credit. For example, some of the best rewards credit cards have application requirements that state that only applicants with a FICO score of 700 or above are eligible. It also gives you a higher credit limit and more control over your money or funds within a specific period.
Possible Drawbacks for a 700 Credit Score
Despite landing squarely in the “good” credit category, a score of 700 has some potential drawbacks to keep in mind as well:
1. Low Interest Rates, Not the Lowest
As we have discovered, while 700 is okay to get approval it will not give you access to the true rock-bottom ultra-low interest rates. Those are for buyers with perfect credit ‘’above 740 or 750’’ scores, and it is rare to find such a score. Thus, you will be charged slightly higher interest if your credit score ranges within 700 or slightly above it. But, probably, above basic rates but still can be beneath the average ones.
2. Vulnerable to Dropping
So, while 700 is deemed as ‘good’, you are one step away from being classified as ‘fair’ — so you do not have much of a buffer before your score gets downgraded by the creditors. Sometimes perhaps you may have a period of tough time financially which could bring you down quite easily so you need to be very careful when it comes to this point as you try to shield your score. A single missed payment or increase in debts threatens to reverse all the credit improvements done over several years.
3. Refinancing Difficulties
There are various criteria for loan refinancing, but credit scores usually should be higher than 740 or even seven hundred forty-one. Therefore with a score of 700, one should not expect to have better refinancing offers, especially from the top credit card providers. It is probably not as cut and dry as getting rejected, but you also won’t be privy to the significantly lower interest cost that comes with better credit. First, try to build your score higher before applying to the list of refinance debts.
Credit repair may sound like a daunting task but it is easy and quite doable especially if you follow these steps as outlined below.
Here is the best thing to know if you have a 700 credit score on your credit report. Every once in a while, even minor changes add up and offer a more favorable outlook on the loan deals you’d be able to qualify for.
Here are smart ways to start boosting your credit today:
• Always make all payments on or before the due dates of the bills
• Avoid using credit cards and if used should be used with a very small balance.
• Reduce the number or frequency of credit applications
• Some of the steps that one may take to improve his/her credit score include;
• Credit builder loans may be necessary if the other options can’t be realized.
This is particularly true when the difference between rates is within the 15 to 20-point range; even a few points can put you in a better class of interest rates. Reaching from 700 to 750 can easily be achieved through one or two wise financial decisions within the period of six to 12 months. It is important not to take on any more debts and continue to exercise patience. That cannot be substituted by anything as swift as shortcuts.
Therefore, asked if 700 credit is ultimately “good” or “bad?
Ultimately, it is FICO and the major credit bureaus who are in the driver’s seat when it comes to the issue of what constitutes a good credit score, 700 credit score included. While not exceptional credit, a 700 FICO provides clear benefits:
• Low rejection percentages on loans and credit cards
• Moderate interest rates that may not necessarily be the lowest and best in the market.
• Additional chances to speak of financial freedom and linguistic flexibility.
Yes, there is a possibility to improve the state of business and move to a new level. Scores that are 750+ are generally considered very good. However, a credit score of 700 implies that the person handles debts appropriately and would likely encounter little difficulty in accessing credit. But do not go in expecting to have a sub-3 percent interest rate for the bonds. And score drops remain a possibility, which is still a risk one has to be cautious of.
All in all, no, a credit score of 700 is not considered ‘bad’ – it is even better than average. Just remember to keep following other good money management practices as well. Safeguard the remaining 700 as deeply as possible while at the same time looking for ways to increase it further. Knowledge and logical credit application are the only ways to achieve 750+ and elite credit borrowing rates.
Call now for expert credit repair services: (888) 803-7889
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