Credit Cards for Great Credit
Helping You Take Advantage of Your Top Credit Score
Having a good credit score is one of the best things you can do for your future. Good credit tells lenders that you are responsible with your money, making them feel much more confident about letting you borrow from them. But it can be difficult to understand how credit scores work, what your credit score is, what you can get with a good (or better) credit score, and what credit card options are available to you. By reading on, you can learn about each of these and better understand how to take care of your credit score as well as how to get the most out of it.
What Does Great Credit Do?
Making the effort to get and maintain a healthy credit score is worth all the hassle. With a good or excellent credit score, you can be eligible for more credit card and loan offers with better terms, amongst other benefits.
Along with getting more credit card offers, having a good credit score can open up the doors to you for credit cards with better rewards. Some credit cards offer points you can redeem on future purchases, while others offer bonus introductory miles or up to 5% cashback on some or all purchases. These rewards can stack up quickly and help you save money on everyday purchases, like gas or groceries, or on your next flight if you’re the adventurous type.
Cheaper interest rates
Another perk to having a good credit score? Credit cards with lower interest rates. A good or excellent credit score means you’ll likely end up paying less money in the long run, as you’ll be eligible for credit cards with a lower interest rate. Borrowers with a healthy credit score can expect an interest rate range of about 12 to 23%, whereas those with poor or bad credit scores may see rates as high as 24%. These are the typical interest rates ranges you’ll see outside of introductory offers.
Generous introductory offers
As your credit score increases, you become eligible for credit cards with a larger variety of introductory offers. Consumers with good or excellent credit scores are increasingly offered cards that will give them thousands of airline miles, points, or cash-back rewards as promotions by lenders. Some credit card lenders may require a minimum initial purchase to activate said rewards, while others give you the bonus immediately.
Zero APR offers
With a better credit score comes an increased willingness from a lender to trust you as a customer, which means you can get offers with zero APR. As always, however, check the fine print to ensure there isn’t an introductory period, after which the rate may increase, causing an interest charge if you still have a balance to pay off.
Top Credit Cards for Excellent Credit
There are plenty of advantages to having a good credit score when it comes to credit cards. In addition to having an increased number of credit card options available to you – and better ones – you also get the ability to choose the type of card that best works for you. If you’ve got wanderlust in your heart, a travel credit card can help you earn airline miles or hotel points. If you’re concerned about running up short-term debt, opt for a zero-interest credit card. If you simply want to see a general return on your everyday purchases, a cash-back credit card is your best bet.
Earn airline miles, hotel points. There are even cards dedicated to earning points for a particular airline or hotel brand.
The most flexible option, cash-back cards offer 1-5% back from everyday purchases you can use on anything.
Looking to pay off a balance and take a break from interest? A zero-interest credit card can rid you of interest charges for up to 15 months.
How Do I Find Out if I Have Good Credit?
Your credit health is scored by two systems: FICO (the most common) and VantageScore. Knowing where you stand with both can help you determine the types of credit cards you’re eligible for.
FICO credit scores range from 300 up to 850. Obviously, the higher your FICO credit score is, the more appealing you are as a consumer to lenders, and the better your credit card options will be. There are different score tiers within this range.
If your score is below 580, your credit is considered to be Poor; borrowers within this range will have few offers, high-interest rates, and aren’t likely to see bonuses or rewards. A fair score ranges from 580-669, good ranges from 670-739, very good from 740-799, and exceptional is any score over 800. Borrowers at a good level will start to see better offers and rewards, and this behavior increase as your score does.
The breakdown of points varies depending on the type of loan you’re applying for; credit cards will have different scales than those used for car loans or mortgages. According to the myFICO site, there are currently 12 rewards cards available to consumers with excellent or good credit, whereas consumers with poor or bad credit only have two options.
The VantageScore system also uses a scale ranging from 300 to 850, but labels them slightly differently, from “deficient” to “excellent.” VantageScore also uses a formula that differs slightly from FICO in order to determine your score, but in both systems payment history is the most important factor. As you would expect, both systems punish you for late or missed payments and reward you for regular, timely payments. For more information, see MoneyGeek’s guide to raising your credit score and MoneyGeek’s guide to getting your credit score for free.
10 Signs Your Credit is Excellent
Even if you aren’t regularly checking your credit, there are still plenty of ways that you can easily estimate your credit score. And if you all of these 10 signs apply to you, then you likely have at least a good credit score, if not one that is excellent or exceptional.
1. Your bills are paid on time.
The most important factor in determining one’s credit score is payment history, according to the Federal Deposit Insurance Corp (FDIC). Paying your bills promptly every month helps improve your credit and tells lenders you are low-risk and more eligible for better offers.
2. Your bills are paid automatically.
The best way to ensure you pay your bills on time is by setting up autopay for all of your bills. Autopay makes it easy to budget your income and expected bills, and helps eliminate the risk of accidentally forgetting to make a payment, which can hurt your score even if it’s only missed once.
3. Lenders are happy to hear from you.
With a good credit score and a steady payment history on your side, you are more likely to also have your lender on your side. This means, in the rare event that you do miss a payment, they may be willing to reverse the applied late fees for that one time – something they are not likely to do for a borrower with poor credit.
4. You’ve got an emergency savings account.
Having a healthy emergency savings account means you have a financial buffer large enough to cover two to six months’ worth of living expenses. This means that, when you end up with unexpected bills from a car repair or hospital stay, you have enough extra money from your emergency cash stash to cover the cover the bills and stay on track with your payments without hurting too badly.
5. You’ve never filed for bankruptcy or foreclosure.
Both bankruptcy and foreclosures are serious events that can devastate your credit score for years to come. You may see a dip in your credit score up to 200 points. Although not ever having either of these on your record is ideal, it is possible to help heal your credit score in the event you do experience one or both of these events. It does take a lot of time and effort to do this, though.
6. You’re always getting credit card offers.
Lenders are more willing to extend offers to you if you have at least a good credit score, which demonstrates a healthy payment history. You pose a low risk to them, as they have proof that you tend to make regular payments on your debts. And the better your credit is, the better your offers will be. You’ll likely be eligible for better rewards, too.
7. You don’t live beyond your means.
It may be fun to live like a wealthy celebrity, but if you’re living beyond your means and regularly maxing out your credit cards to do so, your credit score will suffer, the FDIC says. Ideally, you want to stay below 30% of your credit limit to prevent this.
8. You’ve never been dismissed by an insurer, employer, or landlord.
Your credit score can also potentially be viewed by landlords, employers, or insurance carriers. This is becoming an increasingly common practice, as it is a way to vet your responsibility to your financial debts.
9. Your score comes from your credit card company.
Many credit card lenders are hopping on the bandwagon of a recent trend – providing borrowers their credit score themselves. Though lenders may not show a customer all of their credit scores, one is often enough to keep an eye on your relationship with them.
10. Your credit card has been the same for years.
In addition to having a healthy and steady payment history, potential lenders also look at the length of your credit history. A borrower with twelve accounts that have been open for years will be looked upon more favorably than someone who only has two or three accounts that haven’t even been open for a year yet.
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