Every now and again, I take the time to look at a specific credit score to see how it stacks up.
Today, we’ll focus on a “740 credit score” to see what it means to you, the consumer who relies on credit to get through life.
Heck, even if you don’t use credit cards, there’s a good chance credit scores will determine what you pay for certain things, like your mandatory car insurance.
But before we get started, we’ll need to make sure we’re using the appropriate credit score scale.
This can be either the Fico score scale or the VantageScore scale, with the former being a lot more likely given its monster market share.
740 Fico Score is Near Excellent!
If it’s a Fico-based credit score, which ranges from 300-850, a 740 credit score would be considered close to “excellent” by most credit experts, including myself.
It’s somewhat on the cusp of excellent and good, but probably still deserves the distinction of “excellent” because you’ll qualify for most any credit card, mortgage, auto loan, etc, based on your creditworthiness.
You’ll also receive the most favorable rates and terms on those aforementioned loans, making a 740 credit score pretty darn solid.
Note that while you may have an excellent credit score, other factors, such as income, assets, and employment, may prevent you from getting approved for a desired line of credit.
There’s still room for improvement though. Perhaps lowering your outstanding balances and applying for new credit more sparingly will see your scores rise over time into a more “stable” excellent status.
Either way, keep up the good work.
What About a 740 VantageScore?
A 740 credit score with VantageScore isn’t as hot as a 740 Fico score, largely because VantageScores range from 501-990.
And a 740 score would put you in their “C” bucket, which is well, an average credit score.
Recent data revealed that the average VantageScore is around 750, so a 740 would be a below-average credit score.
It’s not to say you’re in bad shape, but you could certainly improve your credit score quite a bit.
You might even have some negative information on your credit report, such as a 30-day late payment or a medical collection.
In any event, ordering a free copy of your credit report or enrolling in a credit score monitoring program may be a good idea to see what’s holding you back.
A 740 score will definitely mean you’re paying more than you should for things like credit cards, home loans, and even your car insurance, so it’d be in your best interest to take a hard look.
Read more: How do I get my credit score?