A 777 credit score indicates that you usually pay your bills on time. When lenders evaluate you, they will determine that you are a low-risk borrower and can acquire the loan without any problems.
According to FICO, a 777 credit score is good and above good on VantageScore. You can access better loan rates and different types of credit and acquire credit cards from other companies.
How does this score benefit your finances?
The 777 credit score is on one of the highest scales, although it is still a little short of excellent. According to FICO, a perfect score is above 850. However, with this score, you can access different benefits.
One of the most notable benefits is that it helps you qualify for better terms and interest rates on credit cards and loans. A good credit score benefits getting a good job or the apartment/house you dream of.
This score is good when you are looking for a mortgage or are about to make a major purchase where you need a loan with good interest rates. To get it, you need to understand how the credit score works and how it is calculated.
The credit score calculation
To be at the levels needed to please the major credit rating agencies like FICO and VantageScore, you first must know how they work and what they consider establishing a credit score.
One of these entities’ most careful and conspicuous points is payment history. Late payments are one of the main causes of score damage. In addition, collection accounts, charge-offs, and bankruptcies hurt the credit history.
Length of credit history
This implies that the age of credit accounts is taken into account. Users with an older credit history benefit the most from having a good credit score. Newer accounts lower the score.
Conversely, older accounts that you have maintained for years and are consistent in your payments help you maintain a high credit score.
Credit utilization rate
It is not advisable to use all the credit offered. Experts advise using credit below 30%. For example, if the credit card has a $10,000 limit, it is not advisable to reach a balance of $3000.
If possible, it is best to have credit utilization below 10%. Although it may not always be possible, it is best to keep it most of the time to avoid lowering your credit history.
Setting up new accounts
Lenders must run a credit check when you apply for a new loan or credit, which causes extensive inquiries and subtracts points from your score. You can keep the action for up to 12 months.
Likewise, before opening a new account, you should evaluate it properly because it can hurt your score and have a long-term effect on your credit score.
How can I improve my credit score?
Although a score of 777 is good for some people, it is not enough, and they tend to look for ways to improve it. To begin with, note that you will not see an improvement from one week to the next; this task requires time and dedication.
The first thing to do is to evaluate the negative factors you have in your credit history. Even if you pay your debts on time, if you tend to pay only the minimum of your bills, this can continue to affect your score.
A good solution is to pay your loan or credit card with the most affordable amount for your economy. Eliminating these amounts from your credit history will make it easier to increase your score. Likewise, it is not advisable to acquire new accounts while you are looking to improve your score.
On the other hand, review your credit history to eliminate any erroneous data affecting it and not allow your score to increase. As mentioned before, a score of 777 is good, but it can be improved. Higher scores make it easier to access new benefits, and interest rates improve much more.