Whether you are looking for a home loan, gold loan, bike loan, or business loan, a good credit score can make all the difference.
In this article, we will discuss whether 700 is a good credit score and how it impacts the borrower.
Is 700 Considered To Be A Good Credit Score?
CIBIL score ranges from 300 to 900. Any score that falls between 690 to 719 is considered a good credit score.
So, a credit score of 700 is not only good but also creditworthy.
However, is this ideal or the best credit score?
What Is An Ideal CIBIL Score?
Credit score allows the lender to assess the risk the borrower poses. Most lenders prefer lending to individuals who maintain a credit score of 750 and above and this is more applicable to unsecured loans.
However, a credit score of 700 is eligible for a loan even though it comes with stricter loan terms. Individuals with a 700 credit score may not be able to negotiate for a higher amount or lower interest rates.
To borrow a higher amount or to get better loan terms in the future, borrowers must make an effort to increase their credit score to 750 or higher.
Banks consider applicants with a credit score of 750 and higher as ‘financially responsible’ and approve high-ticket loans for lower interest rates.
How To Improve Your 700 Credit Score?
Applicants with a credit score of 700 can easily secure credit but at higher interest rates. Furthermore, there is a higher chance of rejection when compared to applicants with higher scores.
Here is how you can improve your credit score and minimize your chances of being rejected.
Payment History
Your repayment history influences your credit score. Set up an autopay system so you don’t miss any of your EMIs.
Multiple Credit Applications
Too many credit applications can lower your credit score as lenders conduct a credit check. Put a considerable gap between each credit application to maintain your credit score.
Credit Utilization
Having a low credit utilization ratio positively impacts your credit score. Aim for 30% of the card’s limit and do not exceed the limit if you wish to increase your score.
Credit Mix
It's better for your credit score if you mix revolving credit like credit cards with installment loans, which have fixed payments for a predetermined period.
