This Is the Credit Rating You Should Aim For.

Everyone wants to be perfect at something. But when it comes to your credit score, that ideal 850 may not be worth worrying about. In fact, your account should be good enough to impress creditors.

Ted Rossman, an analyst at, noted this in a recent article where he explained his strategy for choosing a new credit card. “Once you reach 740+ years, you will be eligible for better terms,” he said. He explained that activities that slightly affect your score – like applying for a new credit card – can lower your score by a few points, but not enough to make you worry about the health of your credit profile.

But 740 is 110 points below this maximum result. Can you really get the best rates on loans, credit card interest rates or other banking products by getting a B + instead of A?

I asked Rossman why 740 is the magic number. “Anything 740+ is considered great and lenders don’t allocate anything beyond that,” he said. This is because there are many assessment methods that lenders use to determine your creditworthiness when applying for a loan.

VantageScore – the number you see often when using free credit scoring tools – is the result of a collaboration between three credit reporting bureaus , and there are two versions of this method that you can use to calculate your score.

But lenders are more likely to use FICO to get credit scores. And like VantageSCORE, FICO has several different versions of its own scoring model. “Different lenders use different formulas, often because they are used to one and want to avoid the cost and hassle of upgrading,” Rossman explained.

According to Rod Griffin, Experian’s director of education, mortgage lenders can use scoring models as old as FICO 2, while FICO 8 and 9 are the most commonly used FICO models. He reckons the key criterion for the appraisal will be 750. “It depends on the type of appraisal and the lender’s threshold,” Griffin said.

And just to add another wrinkle to this whole situation, some of the scoring models have the highest scores that are well above the 900s.

But don’t worry about the 850 and 900 right now. Rather than working on your numerical estimate as a financial goal, it is more important to think about what factors make up that estimate.

If you pay even the minimum balance on time and don’t use too much of the credit given to you, you are likely to have a solid credit rating, although the actual amount may vary depending on where you look. So stay away from your credit limit and set up auto pay for your monthly statement. Once you hit that 750 range, you can be sure you’ve earned a spot among the best in its class.


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