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June 27, 2025 5 min read

What is a Good Credit Score?

Home » General Finances » What is a Good Credit Score?
In this article, we’ll break down what’s considered a good credit score, how it’s measured, and what that means for your financial opportunities.

Advertiser Disclosure: Our first priority is to provide valuable information to help our readers gain insight into financial topics. Although we receive compensation from some of the brands listed on our site, we only highlight companies we believe can benefit our readers and their financial situations.

Your credit score plays a significant role in your financial life. It influences whether you get approved for a loan, what interest rate you’re offered, and even whether you’re approved for an apartment or cell phone plan. But what actually qualifies as a “good” credit score? That depends on the scoring model being used.

What Counts as a Good Credit Score?

While there are different credit scoring models, most lenders rely on either FICO or VantageScore. Each system uses its own scale to rank creditworthiness, but both agree that higher numbers mean lower risk. The range your score falls into determines whether it’s poor, fair, good, very good, or excellent.

FICO Score Ranges

The FICO Score is the most widely used model by banks and lenders. It ranges from 300 to 850. A “good” credit score typically falls between 670 and 739. This range signals to lenders that you’ve managed credit responsibly in the past.

If your score is within this range, you’re more likely to be approved for loans and credit cards, though you might not always qualify for the best interest rates.

VantageScore Ranges

VantageScore also uses a 300 to 850 scale, but it defines its categories a little differently. A “good” VantageScore falls between 661 and 780. This model weighs payment history, credit usage, and total balances.

Scoring in this range usually means you’ve established a strong borrowing history, which positions you well to access competitive credit offers, especially if you’re on the higher end of the scale.

Why a Good Credit Score Matters

Your credit score does more than determine whether you qualify for a credit card. It can directly affect the cost of borrowing and even influence areas of your life that aren’t tied to loans. A good score helps you access better financial products, improves your approval odds, and can save you money over time.

Better Rates and Loan Terms

Non-Borrowing Benefits

Credit scores can also influence things outside traditional lending. Many landlords check credit before approving rental applications. Insurance companies often use credit-based scores to set premiums.

How Credit Scores Affect Cell Phone Contracts

Cell phone carriers often run a credit check when you sign up for a postpaid plan, especially if you’re financing a new device. A good credit score makes getting approved without a deposit easier and gives you access to lower monthly payments or promotional deals.

If your score is low or you have limited credit history, the carrier may require a down payment, restrict your plan choices, or deny phone financing altogether. In that case, prepaid plans or pay-as-you-go options are available and typically don’t involve any credit checks.

How Credit Scores Are Calculated

Credit scores are based on specific factors that measure how you manage money and debt. These formulas are designed to predict how likely you are to repay what you borrow. While exact calculations vary between scoring models, several core elements have the most significant impact on your score.

Payment History and Utilization

Other Key Factors

In addition to payments and utilization, your score is influenced by the length of your credit history—longer histories tend to score better. Credit mix also plays a role; having a combination of credit cards, loans, and other accounts shows you can handle different types of credit.

Finally, recent applications for new credit can trigger hard inquiries, which may cause a temporary dip in your score. Limiting how often you apply for credit helps keep your score stable.

What’s the Difference Between a Good and Excellent Credit Score?

While a good credit score opens many doors, an excellent score can unlock even more. The difference might seem small on paper, but it can lead to better financial opportunities, lower costs, and access to premium products that aren’t available to the average borrower.

Impact on Borrowing Power

An excellent credit score—typically 740 or above—signals to lenders that you’re a very low-risk borrower. This perception often results in the best available interest rates, higher loan amounts, and more favorable repayment terms.

Whether you’re applying for a mortgage, auto loan, or credit card, an excellent score gives you negotiating power and more options.

How to Reach Excellent

What to Do If Your Credit Score Isn’t There Yet

Steps to Improve Your Score

How Long Does It Take?

Stay Informed and Take Control of Your Credit

A good credit score is more than just a number. It’s a reflection of your financial habits and a key that can unlock better opportunities. Whether you’re applying for a mortgage, financing a car, or even signing up for a cell phone plan, your credit score plays a central role. The best part? You have the power to improve it through informed, consistent actions.

Staying on top of your credit means monitoring your reports, understanding how scores are calculated, and making wise financial choices. Building and maintaining a strong score takes time, but the long-term rewards are well worth the effort.

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        Disclosure

        Our first priority is to provide valuable information to help our readers gain insight into financial topics. Although we receive compensation from some of the brands listed on our site, we only highlight companies we believe can benefit our readers and their financial situations. Consumer Insite has partnered with CardRatings for our coverage of credit card products. Consumer Insite and CardRatings may receive a commission from card issuers.

        Advertiser Disclosure

        Our first priority is to provide valuable information to help our readers gain insight into financial topics. Although we receive compensation from some of the brands listed on our site, we only highlight companies we believe can benefit our readers and their financial situations. Consumer Insite has partnered with CardRatings for our coverage of credit card products. Consumer Insite and CardRatings may receive a commission from card issuers.

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        Disclosure

        Our first priority is to provide valuable information to help our readers gain insight into financial topics. Although we receive compensation from some of the brands listed on our site, we only highlight companies we believe can benefit our readers and their financial situations.

        Advertiser Disclosure

        Our first priority is to provide valuable information to help our readers gain insight into financial topics. Although we receive compensation from some of the brands listed on our site, we only highlight companies we believe can benefit our readers and their financial situations.