A credit score of 696 means you're just on the bubble of getting better credit card deals from banks, along with better deals on insurance quotes, mortgages and car loans. That's assuming we're talking about a standard FICO scale with a maximum possible score of 850, you're just about to cross the line into "good credit" territory.
If you've been steadily building credit or recovering from some bumps along the path to financial stability, keep doing what you're doing. However, if you're thinking about buying a home or a car, you can try a few tactics to nudge your credit score above 720:
- Review your credit reports. According to a recent FTC study, about 1 in 20 American consumers have errors on their credit reports that could cost them 25 or more points on a typical FICO score. If you fall into that 5 percent, that's enough to take you from "fair to good" with just a dispute letter.
- Pay down your balances. Using too much of your available credit can push your score lower. Try using a credit card calculator to see how much you can save if you take a more aggressive approach to paying your balances.
- Re-balance your debt. Ideally, the percentage of your credit utilization should be below 10 percent. For instance, if you owe $500 on an account with a $1,000 credit limit, you're utilization is 50 percent. If another card has a $500 balance with a $10,000 credit limit, some credit scoring systems may see the 50 percent utilization from your smaller account instead the overall utilization of 9 percent. Consider using balance transfer offers to spread your debt proportionally across your accounts.
- Step away from instant approval credit card applications. Opening too many new accounts over a short period of time can make banks think you're trying to stockpile credit. Instead of flagging yourself as a credit risk, take a break from surfing balances and scouring for signup bonuses. Earning a quarter point discount on your mortgage can save you a significant amount of cash over time.
Remember that your credit score alone isn't enough to guarantee you a specific deal. Underwriters combine information from your credit report with data gathered from their institutional partners and from public sources. Your fair credit score shows potential, but you'll have to back it up by managing your current accounts responsibly.
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