So you want to know what it means to have a 724 credit score, whether it's "Good" or "Bad", and how to improve it?
You have come to the right place!
But first, a little bit about me
When I checked my credit score for the first time, it was an "evil" 666.
I had no idea what that meant!
All I knew is that I was that I had just been turned down for a used car loan, and that I had a lot of credit card debt.
I didn't know if my score was "Good", "Bad", or somewhere in between. I also had no idea how to properly manage my credit.
But there was one thing I did know - my credit sucked!
That's when I got serious about reading everything about credit scores and credit reports that I could get my eyes on.
I knew I had to do something about improving my credit score if I was going to buy a decent used car and work toward buying my first home.
All my hard work paid off:
8 Months later, my credit score was an "Excellent" 777!
Read How I Improved My Credit Score by 111 Points for the whole story.
Since my credit score is now "Excellent", my new obsession is to help you better understand your credit score, and what it means for you, so you don't have to spend days on end trying to figure it out yourself.
So let's get on with it:
Is 724 Considered a Good Credit Score?
724 is a Good Credit Score! Most lenders and insurers will consider a "Good" credit score as low risk, and is typically enough to receive some of the most competitive loan terms and rates. Although the best offers are generally saved for "Excellent" credit, "Good" is a big step up from "Fair" (a score below 700).
You got your Credit Score from the wrong place
In my opinion, if you've received your credit score but still don't understand it - you got your score from the wrong source!
The fact is that you have a total of 3 credit scores (one from each credit bureau).
If you’re checking your scores from a reputable source, they will provide detailed information about your credit score – such as why it is what it is, how it got that way, how you rank, what credit rating category you're in, etc.
Having said that, I highly recommend getting All 3 Free Credit Scores from my favorite credit monitoring service: FreeScoresAndMore.
With FreeScoresAndMore, you will have 100% of your credit data.
That includes 3 credit scores, 3 credit reports, daily credit monitoring with monthly score updates, as well as expert knowledge on how and why your scores are what they are, so you won’t have to ask this question again.
My Review: Why I Love FreeScoresAndMoreFULL ANSWER
How Does a 724 Credit Score Rate?
Most credit scores including FICO and VantageScore range from 300-850, the higher the better. Within that range, there are different categories, ranging from bad to excellent. Here's a general idea of the ranges and their "ratings". Your range will be indicated below.
- Excellent Credit: 750 - 850
- Good Credit: 700 - 749 ← You Are Here
- Fair Credit: 650 - 699
- Poor Credit: 550 - 649
- Very Poor: 549 and below
5 Steps To Improve Your 724 Credit Score
Step 1: Before you begin, you need full access to 100% of your credit data. I recommend using FreeScoresAndMore to get your 3 credit reports & scores.
Step 2: Along with checking all 3 credit scores, you need to take a thorough look at your 3 credit reports. Check for errors, and signs of ID theft.
Step 3: Identify what's dragging down your scores. That's where FreeScoresAndMore shines.
Step 4: Develop a plan of action based on the factors which are dragging down your credit score the most.
Step 5: Execute your plan and watch your score rise with a comprehensive credit monitoring service like FreeScoresAndMore.
My score skyrocketed 111 points. Here’s how I did it.
What does "Good Credit" mean to you?
A credit score in this range suggests that you have established a good credit history by making your payments on time, and that you don't have any accounts currently past due, or any recent collections, repossessions etc. on your credit report.
It also suggests that you manage your "revolving credit lines" (credit card accounts) pretty well.
Most lenders and insurers will see you as a low credit risk, and you will most likely be offered some very competitive interest rates on loans and low premiums on insurance.
A congratulations is in order, "Good" is good news. However, there is room for improvement. Some of the best interest rate offers may require a credit rating of "Very Good" or "Excellent". Be sure to check our tips and recommendations on how to improve your credit score.
How Is A Credit Score Calculated?
While exact details of how your 724 credit score was calculated is an industry secret, we do know that credit scores are formulated using many different pieces of data from your credit report. This data is grouped into five categories as shown below. The percentage to the right of each one indicates how important it is in determining your credit score.
- Payment History - 35% - This is typically the first thing a potential lender will want to know. Have you paid your past accounts on time? Have you missed any payments?
- Total Amounts Owed - 30% - How much you owe on each of your credit accounts. Higher amounts does not necessarily mean you are high risk, other factors are considered as well.
- Length of Credit History - 15% - Generally a longer credit history will yield higher credit scores. But that's not always the case, it also depends on how often you use your credit, and how responsibly you manage your debt.
- Types of Credit in Use - 10% - Credit score providers will consider the mix of credit accounts you have, such as credit cards, retail accounts, auto loans, mortgages etc.
- New Credit - 10% - Lenders want to know if you've recently been applying for many credit accounts in a short period of time. That can often represent a greater risk to the lender.
Different Credit Score Range Scales
There are many credit scores available to lenders, most use FICO scores, but even those can vary in how they are calculated depending on the version being used. Lenders can also create their own credit score ranges, or use industry specific credit scoring models such as those geared towards mortgages or auto loans.
Here's a quick look at the various credit scoring models and the range they use:
- FICO Score: 300-850
- VantageScore 3.0: 300–850
- VantageScore (versions 1.0 and 2.0): 501–990
- PLUS Score: 330-830
- TransRisk Score: 100-900
- Equifax Credit Score: 280–850
As you can see, having a 724 TransRisk score isn't nearly the same as a 724 FICO score. For that reason, it's also important to know which scoring model is being used to determine how "good" or "bad" your credit really is.
Some of the questions you probably have are: Is 724 a good FICO Score? Is 724 a bad FICO Credit Score? Is a FICO Score of 724 good or bad? What does a FICO Score of 724 mean? What does a 724 FICO Score mean?
Knowledge Is Power - Especially when it comes to credit scores
Did you know if you've received just 1 credit score of 724, you've only seen 16% of your credit data!
You actually have 3 credit scores based on 3 different credit reports. That's 6 different items which are very important for you to have.
Not having access to 100% of your credit data leaves you vulnerable to credit reporting errors, credit fraud, and identity theft.
Make sure you have access to all of your credit scores and reports, I recommend my favorite premium service: FreeScoresAndMore. With FreeScoresAndMore, you get all 3 credit scores & reports, and daily monitoring of your 3 credit reports, with alerts of key changes to your credit files.
Review: Why I Love FreeScoresAndMore