What Is a Good Credit Score? Understanding the Numbers That Matter

If you've ever applied for a credit card, car loan, or mortgage, you've probably heard lenders talk about your credit score. But what exactly is a good credit score, and why does it matter so much? Understanding these three digits can be the difference between approval and rejection, or between paying reasonable interest rates and losing thousands of dollars over the life of a loan.

The Credit Score Scale Explained

Credit scores range from 300 to 850, and a good credit score falls between 670 and 739 according to the FICO scoring model, which is used by over 90 percent of top lenders. This range represents solid financial behavior and makes you an acceptable borrower in the eyes of most lenders.

VantageScore, another popular model, considers scores from 661 to 780 as good. Both models use the same 300 to 850 range but categorize scores slightly differently.

Breaking Down the Credit Score Ranges

Why Your Credit Score Matters

Your credit score influences nearly every aspect of your financial life. Lenders use it to decide whether to approve applications and what interest rate you'll pay.

The difference between a good and excellent score can save thousands of dollars. Someone with a 760 score might get a mortgage interest rate a full percentage point lower than someone with a 660 score. Over a 30-year mortgage, that difference could mean paying tens of thousands less in interest.

Beyond lending, landlords check credit scores before approving rental applications. Some employers review credit reports during hiring, particularly for financial positions. Insurance companies in many states use credit-based insurance scores to help determine premiums.

What Determines Your Credit Score

Credit scores are calculated using several factors. Understanding these components helps you focus your efforts on what matters most. Learn more about the 5 factors affecting your credit score.

How to Build and Maintain a Good Credit Score

According to Experian, one of the three major credit bureaus, building good credit requires consistent positive financial behaviors over time.

The Bottom Line

A good credit score opens doors to better financial opportunities and can save you significant money over your lifetime. While reaching that 670 threshold should be your initial goal, continuing to improve your score into the very good and excellent ranges will provide even greater benefits.

The key is consistency—building positive credit habits you maintain year after year. Whether you're starting from scratch or working to improve a damaged score, the principles remain the same: pay on time, keep balances low, and be patient. Credit building is a marathon, not a sprint.

Remember, your credit score is not a permanent label. With dedication and smart financial habits, you can improve your score and unlock better financial opportunities. Start today, and your future self will thank you.