dcsimg

What is considered excellent credit?

By , CardRatings Contributor

Our credit card articles, reviews and ratings maintain strict editorial integrity; however we may be compensated when you click on or are approved for offers (terms apply) from our partners. How we make money.

Question: What is considered excellent credit?

Answer: This is a terrific question: unfortunately, there really is no exact answer because the term "excellent credit" is completely subjective. That being said, let me try to shed some light on the topic of credit scores in general, which may help you get a better idea of what excellent credit might be.

First of all, credit standing is relative to the economy and the lender. It was not very long ago that if you had a pet gold fish, it was probably eligible for a credit card! But seriously, excellent credit then was probably a score of 700 or above. It could have been even lower, just because some lenders allowed it to be so. Theoretically, in some cases a score in the 600s could have even been considered "excellent."

Having said all of that, in today's economic climate it is considered excellent only if it's 750 or above. See what I mean by "relative to the economy?" You may also be interested to know that credit scores are ranked in five intervals, each corresponding to 20 percent of the credit-carrying population and assigned the following point spread from highest to lowest: 850 to 780, 780 to 740, 740 to 690, 690 to 620, and anything below 620.

Additionally, though your score consists of several components, some are weighted more heavily than others. On time payment history is the most crucial, making up a third of your score. The next most important factor is your credit utilization--how much you owe in comparison to what you have available--accounting for another 30 percent of your credit score. Longevity of your accounts constitutes 15 percent of your score, while the type of credit you have--for example, secured vs. unsecured--accounts for 10 percent. Finally, recent credit inquiries affect the final 10 percent.

0 Comments

Be the first to comment!

Start Here

Search. Compare. Apply.

Featured Partner Cards

loading
  How is your credit?
Oops! Your credit does not qualify you for this card. Applying and being rejected for this card could possibly hurt your credit
We are redirecting you to offers you are qualified for based on your credit.
720-850
Excellent
660-719
Good
600-659
Fair
350-599
Poor
X
CardRatings is excited to announce the launch of the
100% Free CardRatings Email Course to Learn How to Maximize Travel Rewards.

Created in partnership with ChooseFI

We partnered with ChooseFI to combine CardRatings’ offer expertise with ChooseFI’s tried and true travel rewards strategies. Get to know ChooseFI: they have changed tens of thousands of lives and recently won Podcast of the Year at FinCon.
You may think you are a rewards travel expert, but rewards strategies are changing (e.g., the days of card churning and manufactured spending are numbered). Learn powerful, sustainable strategies (a couple of which even you die-hard travel experts might not know). You'll be so glad you did.
We're planning more courses for the future; this is just the beginning of our journey.
BROUGHT TO YOU BY: