Comprehending the financial factors that contribute to your credit score — elements like credit age and credit type — will help inform your understanding of where your credit score ranks.
A credit score of 780 isn’t as simple as a single number; instead, it’s the result of an equation that integrates recent financial information from existing credit lines, to provide a continually updated snapshot of your creditworthiness.
Your credit score, which is a figure used by potential lenders to gauge your ability to repay loans, is the key to helping you secure low mortgage payments, affordable personal loan interest rates, and one or more credit cards.
Just as higher credit scores can positively influence loan amounts, types, and associated interest, poor credit scores serve as major roadblocks toward obtaining even basic credit. Lenders are understandably hesitant to issue credit to any borrower with a mixed debt repayment history.
Experian is one of the bureaus through which lenders obtain historical information on borrowers. Experian is a credit reporting agency and one of the three major credit companies integrated into the safe-to-use AnnualCreditReport.com tool that sends you regular, free credit reports.
According to Experian, your credit score of 780 ranks as “Very Good,” on a scale of “Very Poor” to “Exceptional/Excellent.” While this is certainly a favorable score, there are still steps you can take to gain the final 20 points toward the highest available ranking tier.
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Why Your Credit Score Is 780
While it’s impossible to determine for sure which factors are contributing to your credit score, common influences on a Very Good credit score include credit age, total balance, and payment history. Continued, full payments that lower your total balance can help further improve your credit score.
Favorable Credit Age
Oftentimes, individuals with newer lines of credit see their credit scores dampened by the overall age of their balance. Since credit age — how long your accounts have been active — is one of the main factors in determining a credit score, your credit score of 780 is likely improved by the fact that your accounts have reached maturity.
As the months pass, the average age of your accounts will continue to naturally increase. With time, you can expect to see a parallel increase in average credit score, as the age of your credit continues to yield positive dividends toward further increasing your 780 credit score.
Low Total Balances
No matter how many lines of credit you currently have active, low overall balances are key to upholding favorable credit. Given your Very Good credit score of 780, you’ve likely optimized your regular payments to keep loan repayments as substantial as possible.
Look to limit unnecessary purchases or impulse buys, while keeping total credit balances low. And as always, ensure you pay off monthly debts before they begin to accrue interest.
Sustaining low overall credit balances has more to do with disciplined financial practices, and less to do with your average monthly income.
No matter the total amount of income you generate on a weekly or monthly basis, you can keep balances low by keeping payments against your balance higher, or as high, as any new credit you accrue.
Pristine Payment History
As the single-highest contributing factor toward determining your overall credit score, payment history is essentially your record of credit repayment. Whether you’ve made full or partial payments, on-time or late payments, or missed payments entirely, payment history can single-handedly improve or reduce your credit score regularly.
Your 780 credit score means there’s still room for improvement. However, you’ve likely reached this point because you’ve made methodical, continuous, complete monthly payments against your statement.
And if you have one or two marks against your payment history, you can put them even further into your past with a few more months of successful, on-time repayments.
What Can You Do With a 780 Credit Score?
While further improving your credit score to the Exceptional/Excellent level can help you unlock further financial benefits, a credit score of 780 is certainly sufficient to help you take steps to pursue your financial future.
Whether your goal is to attain low car insurance premiums, obtain a property loan, or simply secure one of the best available rewards-based credit cards, your 780 credit score is the key toward using credit to improve security and quality of life.
Consult the below details for specifics on what exactly a credit score of 780 can help you accomplish.
- Rewards-based credit cards help you earn concrete benefits simply by spending your own money. With a credit score of 780, you’re certainly in line to obtain a credit card that yields:
- Hotel or airline benefits;
- Restaurant rewards;
- Cash-back options no matter where you swipe the card itself.
- Mortgage loans are typically simple to secure with a credit score of 780, though you’re likely not in line for the lowest possible interest rates. Even so, your next property loan will be relatively straightforward to land with your current credit rating.
- Personal loans can be used for a wide variety of applications, including property renovations, weddings, emergency costs, even debt consolidation.
- Backed by a credit score of 780, you should be able to obtain a personal loan without much difficulty, with the possibility of landing the best possible interest rate along the way.
- Car insurance rates are favorable with a credit score of 780, though you’re unlikely to land the best possible insurance premium without an Exceptional/Excellent score, given high levels of competition among auto insurance providers.
How to Improve a 780 Credit Score
With a credit score like 780, you’re likely satisfying most, if not all, of the basic benchmarks to create a solid credit score foundation. Namely, addressing loans in default, prioritizing payments to collections agencies, and avoiding late payments help you quickly transition negative consequences into positive benefits for your credit score.
To further improve your credit score toward the Exceptional/Excellent threshold, consider using even less credit each month to lower overall credit utilized. This makes statements even easier to pay off in their entirety, and helps directly improve your overall credit score.
You can also improve credit utilization percentages by successfully increasing your overall credit limit, since the percentage of credit used will be less, given the higher credit limit.
Avoiding excessive hard inquiries also helps to sustain a Very Good credit score. Hard inquiries, performed by credit institutions when evaluating you as a borrower, can also reflect negatively on your credit score if more than a few are performed during a single calendar year.
Even though they only remain on your financial record for 365 days, hard inquiries indicate additional lending risk, and should be avoided when they’re unnecessary to preserve your preferred status in the eyes of potential lenders.
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