750 Credit Score Explained - What You Need to Know

750 Credit Score Explained - What You Need to Know

Learn about the benefits of a 750 credit score, how to maintain it, and how to improve your 750 credit score.

credit score, also known as a FICO® Score, is a number between 300 and 850. Within this total range, there are five subranges titled Very Poor, Fair, Good, Very Good, and Exceptional. If your score is a 750, it falls within the Very Good range which includes scores between 740 and 799.

A Very Good credit score of 750 means that your score is considered to be above average which makes you usually qualify for better interest rates from lenders and gives you access to product offers and additional benefits.

To put this into perspective, only 1% of individuals with a Very Good score are likely to become seriously delinquent regarding credit in the future. Of total credit scores, 25% of individuals have a score that falls in the Very Good range.

The benefits of a 750 credit score

A 750 credit score is an indicator that you have a proven reliability of paying bills in a timely manner and have good credit management. Some things that may hurt your credit such as a late payment or negative entry are very unlikely to be reported on your credit file.

Banks and credit card issuers are likely to work with customers who have Very Good credit scores and offer borrowers lending terms that are better than the baseline terms. This may include better refinancing options, credit card opportunities, or accounts with rewards and low interest rates among other benefits as well.

Keeping up a 750 credit score

A 750 credit score is not always easy to maintain. A 750 credit score means that you have been keeping up with items that affect your credit score such as timely repayment and keeping utilization under control among many factors. It is important to keep up some key habits in order to make sure your score does not decrease.

Below are items that impact your credit score that you should be mindful of.

On-time payments:

35% of your credit score is determined by your payment schedule. If you miss a payment or pay it late, your credit score is impacted. The missed or late payment then becomes a part of your credit history and can have a significant negative impact on your credit score.

Credit utilization:

The percentage of your credit card that you use is called your credit utilization rate. This may be called your revolving credit utilization or usage rate. This is determined by the total amount you have access to on your credit score and how much you’ve used. For example, if you had a credit card with a $5,000 limit and you spent $1,000 on it, your utilization percentage would be calculated by $1,000/$5,000 or 20%. All of the total utilization on each credit card you have is used to find your overall utilization.

Typically, a lower credit utilization will help maintain your credit score. It is recommended to keep your utilization rate at or below 30%. Going above this and upwards to 100% makes your score more likely to be hurt.

Your utilization rate is used to calculate 30% of your total credit score.

Length of credit history:

The length of your credit history plays a significant role in determining your credit score. Having a longer credit history will help you have a better credit score. This means that if you maintain your payments and utilization, your score will increase with time. The length of your credit history can account for up to 15% of your credit score. Your credit history showcases that you have been able to manage credit well in the past and have experience in being able to responsibly use the credit given to you.

New accounts and applications:

When you apply for or open a new line of credit, you are automatically flagged as being at risk of being less likely to pay your bills. Your score will usually have a slight decrease, but within a few months, it should return to its original number as long as everything else affecting your score stays the same. New accounts and applications account for about 10% of your total credit score. When you apply for a new line of credit, a hard check is done on your creditworthiness, this temporarily affects your credit score. Multiple hard checks, however, are not advisable as they can cause some damage to your existing credit score.

Debt Types:

Having multiple types of credit, including revolving credit and installment loans, helps contribute to your credit score. Revolving credit includes credit cards, which allow you to borrow against a spending limit and make payments. Installment loans, such as student loans, mortgages, or car loans, have set monthly payments and a set payment period. Debt composition accounts for about 10% of your credit score.

Public Records:

Public records can negatively affect your credit score. An entry, like bankruptcy, insolvency, or untimely repayment of a loan does not automatically show up on every credit report, but it can impact other factors of your score. Entries like this can stay on your credit report for up to 10 years. Taking care of judgements and liens that may be on your report is essential to keeping a good credit score.

How to improve your 750 credit score

Understanding and checking your score is the best way to improve it. Because each score has different factors such as age and number of accounts, your approach should be tailored to your specific circumstances.

Protecting your 750 credit score from fraud

Having a 750 credit score takes time and energy and can make you more susceptible to being targeted for identity theft. Utilizing a credit-monitoring service and identity theft protection may be a good idea to safeguard your credit. These services may also help you track changes in your credit score and give you tips to improve it and reach the Exceptional range. In addition to this, managing your credit cards and simply being smart about repayment of your lines of credit can also help you slowly climb up the credit score ladder.

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