How Good Is a Credit Score of 745?

FT Contributor
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Whether you need a new credit card or a mortgage loan, your credit score — an assessment of your ability to repay a loan — helps you spend the money in the ways you want. Your current credit score of 745 officially ranks as “Very Good,” according to Experian’s official credit scoring range.

It’s normal to be confused by your credit score, an equation of five individual financial factors that can be difficult to understand. These influences on your overall credit score include:

  • Credit history;
  • Credit age;
  • Credit type;
  • Payment history;
  • Total remaining debt.

Together, these factors make up a credit score that serves as a major influence any time you are considered for a loan. Good credit scores can open the door for low interest rates and higher spend thresholds, while lesser scores mean credit approval can come with additional fees or higher premiums.

The first step toward improving your credit score of 745 is connecting with a free, safe-to-use credit reporting service like AnnualCreditReport.com, which provides regular updates on your credit score, together with common reasons for recent increases or fluctuations.

Eventually, informed borrowers can raise Very Good credit scores of 745 to “Exceptional,” the highest available ranking tier.

Why Your Credit Score Is 745

While it is not possible to definitively determine which individual ranking factors are affecting your credit score of 745, common influences on a Very Good credit score include payment history, credit age, and hard inquiries within the past year.

Payment History

As the single most important ranking factor to determining your credit score, payment history makes up 35% of the total credit score equation. A credit score of 745 likely means that you’ve made a habit of making full, regular payments to keep debts down.

Here’s the good news: simply paying down credit balances is one of the fastest ways to systematically improve your credit score. Guard against late or incomplete payments, which could compromise your Very Good credit score and make the path to an Exceptional score more challenging.

Consider setting reminders in your phone’s calendar, or setting up automatic balance payments in your credit account, to ensure that payments are always made on time, for the correct amounts.

Credit Age

The age of your credit is also a factor that determines your overall credit score. There is typically a positive correlation between overall credit score, and how long your credit accounts have been active. With a credit score of 745, credit accounts have likely matured to the point that their age is positively influencing your overall score.

Credit age is determined by averaging the age of all existing lines of credit. This means that opening a new credit card, while increasing the total amount you can spend per month, will decrease your overall credit age.

Look to minimize total lines of credit if credit age is a potential issue, so that the average credit age is not cut in half by any new credit lines.

A borrower who continues to make on-time payments from a maturing credit account will positively influence his or her overall credit score, through a constantly-increasing credit age. “Fair” or “Very Poor” credit scores are often negatively affected by credit accounts that have only been open a short time.

Minimized Hard Inquiries

Any time a traditional lender evaluates a borrower’s loan application, a hard inquiry is performed. A hard inquiry is a standard check of a borrower’s creditworthiness — their capacity to pay back a loan once issued.

An individual with a credit score of 745 is not likely to have excessive hard inquiries in their financial history. Hard inquiries can remain on a person’s financial record for up to one year; while one or two hard inquiries are typical on a yearly basis, excessive hard inquiries can lower a credit score.

A large number of yearly hard inquiries can also indicate to lenders that a potential borrower is constantly seeking to open new lines of credit, a bad sign when it comes to paying back individual loans.

What Can You Do With a 745 Credit Score?

A Very Good credit score will help you unlock a wide range of financial opportunities, from personal and property loans to the best rewards-based credit cards available today. Reference the below information for even more opportunities a 745 credit score allows you to secure.

  • Rewards-based credit cards are an option for individuals with 745 credit scores. Score hotel points, earn airline miles, even secure rewards from retailers with a rewards-based credit card available to Very Good credit holders.
  • Mortgage loans are fairly straightforward to obtain with a credit score of 745. Borrowers likely won’t earn the lowest possible interest rates available from lenders, but reasonable fees allow you to own property when you want to.
  • Personal loans help you cover private expenses, whether that’s a destination wedding or an unforeseen medical bill. A credit score of 745 might even mean securing the best-possible personal loan rate.
  • Apartment rentals are a done deal with a credit score of 745. Especially since many apartment communities typically deal with lower credit scores, it’ll be easy to move into virtually any apartment with a Very Good credit score of 745.

If your score ever drops, lower credit scores can make it more difficult, though not impossible, to secure new lines of credit. In a pinch, personal loans for bad credit scores still allow you to borrow funding. Other lenders even offer loans for poor credit scores, despite a sometimes lengthy application process.

How to Improve a 745 Credit Score

Further improving a credit score of 745 means doing the simple things right. Keep overall debts minimal, make full payments every month, and reduce yearly hard inquiries to optimize your account for future improvements.

Improving a 745 credit score also means maintaining disciplined spending habits. Keep loan utilization low by paying down debts as fast — or faster — than you generate new debt. Reducing impulse purchases can also mean you’ll be able to make larger payments toward debts when balances are due.

Maintaining positive spending habits could mean that your credit score of 745 is in line for future improvements. Once you reach a score of 800, your Very Good score becomes “Exceptional,” unlocking the best benefits available. The lowest-possible interest and mortgage rates, and bottom-barrel auto insurance premiums, are only a single credit level away.


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