The credit score is one of the most important things to consider if you live in the United States, so many people constantly ask themselves whether, for example, 720 is a good credit score.
They also wonder what too low a score is, the maximum score, and several other questions that we will talk about here today. But the truth is that having as high a credit score as possible will allow you to take out loans, mortgages, etc.
At the same time, the credit score is granted by your economic capacity. You will have a high score if you have a stable income, have previously taken out other loans that you have repaid regularly, and have different conditions. Let’s see how that 720 score is in the financial sphere!
What credit are scores available?
First of all, it is important to know how the credit scoring system works in the United States. It adds or subtracts depending on your economic activities and, above all, your creditworthiness.
The credit score can go from a minimum of 300 to a maximum of 850. Everyone starts their adult or working life with 300, and it will add up as we earn money or get loans due to our economic capacity. But, be careful because it can also go down if we incur debts or if we are late in the payment of a loan installment, among other things.
So, you can conclude that, of course, 720 is a very good score if we consider that the maximum is 850.
However, if you want to increase it even more, don’t worry because many solutions exist. Starting with getting a report on your credit score, you will surely be able to know what issues are the ones that contribute something negative to the score, and that is why it does not reach the maximum.
And once you know what these are, which are usually precisely things like liens or late payments, you can put a solution to them. For example, a company called Lexington Law is specifically dedicated to raising credit by solving the economic problems of all those who want to improve.
What allows you to have a 720 credit score?
But before you consider improving that credit score above 720, you will have to consider the advantages of having this score, which is quite high compared to others.
You should know that you will be able to apply for a credit card in your name with this score and obtain a personal loan. On the other hand, you can also apply for a mortgage loan, which usually requires a minimum score of 620.
You can always try to improve and get an excellent credit score. It is also interesting for you to know how the American society distributes the scores: in the past year, 2021, approximately 16% of the community had a very low score, below 580. About 17% of the inhabitants had an average score ranging from 580 to 670. Then, a score between 670 and 740, among which you find yourself if you have a 720, 21% of Americans have it. Finally, 25% of people have between a 740 and a 799, which is a very good score, and another 21% with a score between 800 and 850, which is the limit.
As you can see, things are pretty evenly distributed, and there is a high percentage of people who have a low score and cannot access many of the economic advantages offered by the banks. These people should know that it is possible to get small personal loans in many entities that do not look at your credit score.
Whenever you can, try to improve the situation by knowing what is detracting from your score and how to make the change to be at the top of the score.