730 Credit Score Explained - What You Need to Know

Your credit score is a number calculated to help lenders decide if they want to give you a credit line or loan and what interest rate they want to give you. This number falls between 300 and 850 and there are five subranges, titled Very Poor, Fair, Good, Very Good, and Exceptional.

If you have a 730 credit score, it falls within the 'Good' range which includes scores between 670 and 739.

A 730 credit score falls right above average that the overall U.S. credit score average at 711. To lenders, a Good credit score like 730 means that you are not likely to become seriously delinquent with your future credit.

A 730 credit score that is in the Good range can be caused by several factors. If you haven’t had credit for a long time, the length of your credit history may be the factor keeping you from a higher score. If you have a longer credit history, you may have had a missed payment or currently have high credit usage rates causing the score to stay in that range.

A 730 credit score can help you become eligible for opportunities like buying a house, getting a new car, or qualifying for a new credit card. However, even with a good credit score, you probably will not be eligible for the lowest interest rates or the best rewards programs.

Keeping up your score is important to ensure you can meet your goals in the future. Having a firm understanding of your credit score can help you maintain and increase your score. Here are a few ways you could do that.

On-time payments

Keeping up with your payments is one of the most important parts of your 730 credit score. Your payment schedule makes up 35% of your credit score. A late or missed payment can negatively impact your credit score. Staying on top of your payment schedule ensures that you can likely maintain or even improve your score with time.

Credit utilization

The next most weighted area of your credit score is your credit utilization rate. Credit utilization, which is also known as revolving credit, is how much of your available credit you’ve used. For example, if you had a credit card with a $2,000 limit and you spent $500 on it, your utilization percentage would be calculated by $500/$2,000 or 25%. While calculating your credit utilization, it takes into consideration all of your credit lines, so basically all of your credit cards, together.

Experts recommend that you should keep your credit score at or below 30% to maintain and increase your credit score. 30% of your credit score is calculated by your credit utilization so it’s important to be aware of how much your rate is.

Length of credit history

How long you have had your credit also contributes to your 730 credit score. The length of your credit history accounts for about 15% of your credit score. Essentially, a longer credit history is used to understand how you maintain your credit over time. A longer history of on time payments and low credit utilization shows that you are trustworthy and are consistent with being able to manage lines of credit in the long run.

New accounts and applications

When you apply for a new line of credit, such as a credit card or for a mortgage, your score will temporarily decrease from 730. This is an automatic flag since you have a new risk of things like late or missed payments or increased credit utilization. New accounts and applications make up 10% of your credit score, so, this is an important factor to keep in mind while opening new accounts and submitting new applications.

Types of Credit

There are two types of credit. Having both is important to make sure you maintain the best score possible. The first type of credit is called revolving credit which has a set limit and a variable repayment schedule. Credit cards are a type of revolving credit. The second type of credit is instalment loans which have a fixed payment and set schedule. Car loans and mortgages fall under instalment loans. Having different types of credit accounts for 10% of your credit score.

Public Records

The final contributor to your credit score is public records. A public record includes things like a bankruptcy, for example. Some of these records may not show up on every credit report, however they have the potential to impact your score for up to 10 years. With a public record mark, you may not be eligible for some lines of credit.

Improving your 730 credit score can help you become eligible for better rates, reward programs, and enable you to work towards larger goals like owning a home. Here are some tips to improve your score.

1. Track and follow your score. Without knowing your specific score details, you are less likely to effectively increase it.
2. Automate your payments. Keeping up with your payments helps contribute to helping keep up your payment schedule.
3. Have a strong mix of credit, including revolving credit and instalment loans.
4. Keep your credit utilization below or at 30%.

If you have credit cards and are interested in reducing your APR to 12%, earning rewards for paying card bills, and no fees, be sure to check out Gauss.