What can you do with good credit? More than you might imagine. With a strong credit score, you can access a variety of benefits and financial opportunities that make managing your money much easier.
From getting approved for mortgages with favorable terms to qualifying for premium credit cards, a high credit score opens doors to financial advantages that others might miss. The possibilities are endless, and your credit score is the key to unlocking them.
What is considered a good credit score?
In the U.S., credit scores typically range between 300 and 850. According to most scoring models like FICO, a score between 670 and 739 is generally considered good, while anything above 740 is classified as very good or excellent. If you’re in the 700s, you’re in a strong position—lenders see you as less risky, opening up financial opportunities that those with lower scores may miss.
Having a good credit score gives you the power to qualify for favorable loan terms and access to better credit products. But if you’re in the very good or excellent range (above 740), you become a financial powerhouse. A great credit score allows you to take full advantage of the perks that come with strong credit. What can you do with a good credit score? The better question is, what can’t you do?
What you can do with good credit
A high credit score not only boosts your chances of loan approvals, it opens a world of financial perks—including lower interest rates, exclusive rewards, and increased borrowing power.
1. Qualify for lower interest rates on loans
The most immediate and noticeable benefit of having good credit is access to lower interest rates. Whether you’re financing a car, taking out a mortgage, or applying for a personal loan, lenders are more willing to offer competitive rates to borrowers with solid credit. Even a minor difference in interest rates can save you thousands of dollars over the life of a loan.
2. Receive exclusive credit card offers
With good credit, you can access premium credit cards that offer rewards like cashback, travel points, and perks such as airport lounge access or insurance benefits. Lenders view you as less risky when it comes to paying them back, so you're more likely to receive higher credit limits, lower interest rates, and better rewards. Some cards even provide enticing signup bonuses worth hundreds of dollars. However, keep in mind that while credit score is important, lenders also consider other factors like income and credit history when making approval decisions.
3. Get approved for mortgages and auto loans
A good credit score gives you the keys—literally. If you’re looking to purchase a home, your credit score will largely determine whether you qualify for a mortgage and the rate you’ll pay. The difference between having a credit score of 700 or above and a lower score can result in an interest rate variance. Over a 30-year mortgage, for instance, this small difference can save you tens of thousands of dollars.
4. Negotiate better rental and lease agreements
Landlords often run credit checks on potential tenants to assess their reliability with payments. Having a good credit score can make a significant difference in the rental process. It not only boosts your chances of getting approved but may also allow you to negotiate better lease terms.
For instance, a strong score can help you avoid larger security deposits and potentially give you leverage in securing lower rent or more favorable lease terms. In competitive markets, tenants with scores above 700 gives landlords confidence that you’ll make payments on time, which could make them more flexible in offering better lease conditions.
5. Save on insurance premiums
Your credit score can also help your insurance premiums. Insurance companies in many states use credit-based insurance scores to determine premiums for auto, home, and even life insurance. A good credit score can reduce your monthly insurance costs, potentially saving you hundreds of dollars each year.
6. Increase your borrowing power
If you’re asking, “What can I do with good credit to make money?” the answer lies in leveraging your borrowing power. With a high credit score, you can qualify for higher credit limits, which gives you access to more funds at lower interest rates. This opens the door to using loans or credit lines for smart investments, such as real estate or starting a business, allowing you to generate additional income. The key is to ensure you’re borrowing responsibly and managing your debt well.
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Stay smart: Bonus tips for managing your good credit
Having a good credit score opens up numerous opportunities, but don’t get carried away. Here are some tips to ensure your good credit works in your favor and doesn’t lead to financial mistakes:
- Avoid over-borrowing. Just because you qualify for higher credit limits or bigger loans doesn’t mean you should take them. Borrow only what you can afford to repay comfortably. Overextending yourself could lead to debt spirals, making it difficult to maintain a good credit score in the long run.
- Don’t overspend on rewards cards. Premium credit cards with rewards like travel points or cashback can be tempting, but be careful not to overspend just to chase rewards. The interest charges from carrying a balance can quickly outweigh any rewards you earn, especially if you fail to pay off your balance in full each month. (Here’s how to redeem credit card points—and the best ways to use them.)
- Watch out for new credit applications. While it might be tempting to apply for multiple credit cards or loans when your credit is strong, each application results in a hard inquiry on your credit report, which can temporarily lower your score. Space out new applications to protect your credit score.
- Keep an eye on interest rates. Even with good credit, not all financial products are equal. Make sure you understand the terms of any loan or credit card you’re signing up for—especially interest rates and fees—so that you're not surprised by high costs later on.
- Stick to a budget. Good credit should work alongside solid financial habits, like budgeting. Without a plan, it’s easy to spend beyond your means, relying on credit for everyday expenses. This can lead to accumulating debt, which can quickly lower your score if not managed properly.
By managing your credit wisely and avoiding these common pitfalls, you can maintain a strong credit score while keeping your financial health in check.
Bottom line
Good credit does more than just open doors—it gives you the ability to make smarter financial moves. From securing lower interest rates on loans and mortgages to accessing exclusive credit cards with premium rewards, a strong credit score puts you in control.
With good credit, you can negotiate better deals, save money, and take advantage of opportunities that may otherwise be out of reach. Maintaining good credit ensures you're always ready to seize these opportunities and build a financially empowered future.
FAQs
What is a good credit score in the U.S.?
A credit score between 670 and 739 is generally considered good, while anything above 740 is classified as very good or excellent. If you manage to exceed 800, you're in the exceptional range, which may give you access to the best financial products and rates available. However, you don’t need to aim for perfection—a score above 800—to start seeing benefits. Once your score reaches the 700s, many lenders will already offer you favorable rates, rewards, and perks.
What can I do with a 700 credit score?
With a score of 700, you can qualify for lower interest rates on loans, get premium credit cards, and increase your chances of getting approved for a mortgage or auto loan. You may also negotiate better terms on rentals and insurance.
Can good credit help me with my insurance premiums?
Yes, having good credit can help lower your insurance premiums. In most states, insurers use credit-based insurance scores to assess how likely you are to file claims. A higher credit score often signals lower risk, which can result in lower premiums for auto, home, or life insurance. While this practice varies by state, having a strong credit score generally helps reduce your insurance costs.