Compare Credit Card Offers for Good Credit
Updated: January 3, 2018
Here are the Best Credit Cards for Good Credit in 2018:
Having good credit opens up possibilities for better credit cards, improved interest rates on loans and even improved chances with jobs or apartments.
Here, we look at:
- Credit score range for good credit
- Why should I care about my credit score?
- What should I look for in a credit card if I have good credit?
- What determines good credit?
Whether you want to understand how to improve your credit or why you should care about having good credit, we can help.
Credit score range for good credit
The credit score range for good credit with FICO is 670-739 on a scale of 300-850, with 850 as the best. FICO is the dominant scoring model and is used by most lenders to assess your creditworthiness. Anything above 740 is considered excellent. The better your score, the better the lending terms, credit cards, insurance rates and other benefits you’ll get.
Why should I care about my credit score?
- Installment loans. The best known of credit score uses, your credit can impact not only your interest rate but even whether you can get a loan. Credit scores are used by lenders of mortgages, car loans, private student loans and other lending products.
- Credit cards. The credit cards with the richest offers typically require good or excellent credit. For example, you can get a rewarding cashback card with no annual fee if your credit is good or excellent.
- Apartments. Increasingly, landlords are looking at potential renters’ credit before making a call on accepting a lease application. If you have good credit, you are that much more likely to be accepted.
- Insurance premiums. An InsuranceQuotes.com study in 2014 shows that if you have poor credit, your home insurance premiums nearly double when compared to excellent credit. In the same way, your auto insurance premium can be affected by your credit.
- Cellphone. Your cellphone provider may run a background check to ensure you can meet your obligations.
- Employment. Employers are increasingly running background credit checks prior to offering a job. Employers access a different report from that of lenders, and they don’t have access to your score. Also, they have to have your approval to pull a report.
- Dating prospects. When asked if a credit score could make you think twice about dating someone, 35% of men and 50% of women said yes, according to a Bankrate poll commissioned in May 2017.
What should I look for in a credit card if I have good credit?
- Types of cards. With good credit, your options open up tremendously. You can earn 2%, 3%, even 5% back – depending on the category – with a cashback card, or earn points or miles in the 10s of thousands in a travel card’s sign-up bonus.
- Sign-up bonus. Compare the sign-up bonuses for the cards you are looking at. But be sure to compare apples with apples. For example, is there an annual fee? And what is the actual valuation of the points or miles?
- Ongoing rewards. Study the points, cash back or miles you would earn when you make purchases on your card.
- Benefits. Cards that require good or excellent credit often offer benefits such as rental car insurance, free luggage and even annual airline credits.
- Interest rates. If your priority for your next credit card is a low interest rate, your good credit will help with that. There are a few low-interest cards out there, often available through credit unions, and you can even find them at below 10%.
- Balance transfer. If you need to transfer a balance to a 0% intro APR, look at the length of the offer, and see if you can pay off the debt before the offer ends.
What determines good credit?
- Paying on time. The most important aspect of your credit score is on-time payments. It makes up 35% of your FICO score, the score most used by lenders to assess your creditworthiness. One late payment can drop your score to the next range, although the older that late payment gets, the less impact it has. This category is also the most important factor for VantageScore, the scoring model developed by the 3 major credit bureaus: Experian, Equifax and TransUnion.
- Paying in full. This category makes up 30% of your FICO score. It looks at the amount of credit you have available compared to the amount you owe. That’s called your utilization ratio. For example, if you owe $100 and you have $1,000 in available credit, your utilization ratio is 10% -- you want the percentage as close to zero as possible. The amount of credit used is considered highly influential in the VantageScore model.
- Credit history. How long have you had a credit file with the 3 credit bureaus? This makes up 15% of your FICO credit score and it’s highly influential with VantageScore.
- Recent credit. Avoid applying for multiple credit cards at once, because that can negatively impact your score, although a single pull typically only impacts your score by about 5 points. Recent credit makes up 10% of your FICO score and falls under “less influential” on VantageScore. Note that rate shopping for installment loans within a short amount of time, which can range from 15-45 days, typically only counts as one credit check, because credit score models recognize that rate shopping is a good credit habit.
- Credit mix. FICO likes it when you have different types of credit, such as revolving credit (cards) and installment credit (car loans and mortgages). It makes up 10% of your FICO score and is highly influential in VantageScore.
- Available credit. VantageScore also has a category called “available credit” that is considered less influential. There is also a category called “total balances/debt” that falls under moderately influential.
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