What Is The Ideal Credit Score?

What Is The Ideal Credit Score?
Alexander Yu
Guest Author : Alexander Yu
Updated on : February 23rd, 2022

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Few numbers are more important in your financial life than your FICO credit score. This score, which can range from 300 to 850, is meant to be a measure of how good you are at handling debts and repaying loans.

In general, higher your score, the more lenders will bend over backwards to offer you great rates on loans. For larger loans such as mortgages and auto loans, having a better score could potentially save you many thousands of dollars.

But does that necessarily mean you should strive for that perfect 850 score, which is incredibly difficult to attain? It turns out that in most cases, you can unlock the best rates and financial products as long as your score is 780 or higher.

The good news is, 780 is definitely achievable for the average person. In this post, we’ll share why all you need is a score around 780, and how to work your way up there.


Why Your Target FICO Credit Score Should Be 780

When you apply for credit from a lender, how does the lender know if you can be trusted? Cue the FICO Credit Score–a widely accepted measure of your creditworthiness using data gathered from your credit history.

Any time you apply for credit, the lender will pull your FICO score (also known as an inquiry). But while lenders do want to know your credit score, they only care about it to a certain extent.

In the world of auto loans, a 2020 report by Experian found that those with a “super prime” score of 780 or higher qualified for extremely low rates averaging at 3.27%. Those in the “prime” category (661-780) had rates averaging 4.21%. Notably, a score of 780 already means you’re getting the best rates, and further improving your score likely won’t save you more money.

In other words, there’s no practical need to get your score to 850 or even 800, at least for auto loans.

The same is true for mortgages. While most sources agree that 620 is the minimum score you need to reliably get approved for a mortgage, the best rates are reserved for those with a score of 760 or higher according to Experian. Again, going any higher than this is unlikely to further lower your rates.

Thus, simply getting your score to 760 or 780 can help you unlock the best rates on two of the largest loans you’ll ever take out in your life.


How Do I Get to 780?

If achieving a 780 credit score seems like a pipe dream to you, don’t despair. Getting to 780 won’t happen overnight, but you can start taking small, actionable steps today.


First, it’s worth breaking down exactly how your FICO score is calculated so you have a good idea of what you should be focusing on. Your score is made up of five categories:


  • Payment history (35%). Understandably, the biggest piece of your credit score is how consistent you are at making your payments on time.

  • Amounts owed (30%). Another big piece is amounts owed, or how much debt you have. In particular, what matters most in this category is your credit utilization–if a lot of your available credit is currently being used, you could be seen as higher-risk.

  • Length of credit history (15%). The longer you’ve had your credit accounts, the better. Factors that go into this category include the age of your oldest and newest accounts, as well as the average age of all your credit accounts.

  • Credit mix (10%). Having different types of credit accounts is better, but this only accounts for a small part of your score.

  • New credit/inquiries (10%). You may be seen as higher risk if you’ve applied for a lot of credit within the last 12 months. These show up as inquiries on your credit report.

You can get your credit score for free. Depending on where you currently are, you’ll want to focus on different categories to reach 780 most efficiently.

If You Have Poor Credit (Below 600)…

A score below 600 is indicative of major credit issues that you have to address as soon as possible. You might have a history of missing payments, or multiple errors on your credit report. We recommend focusing on the following:

  • Review your credit report for errors. According to the Consumer Finance Protection Bureau, one in five people have an error on at least one of their credit reports. It’s always worth auditing your credit report to see if there’s simply an error that’s dragging down your score.
  • Consider credit repair. If you do find errors, you could fix your credit score yourself by disputing them with the credit bureaus. You could also consider hiring a reputable credit repair company do it for you.
  • Pay down high-interest debt. To regain control of your finances, you have to prioritize paying down your high-interest debt. For many people, this is credit card debt, but it could also include other forms of loans such as payday loans or title loans.

If You Have Fair Credit (600-700)…

If you’re somewhere between 600 and 700, you’re making great progress towards 780. You might still be inconsistent with your payments, but you’re starting to build positive history. We recommend focusing on the following:

  • Review your credit report for errors. At this point, it’s still worth looking at your credit report to see if there are any errors weighing you down. If you find any, dispute them.
  • Make your payments on time. Payment history accounts for 35% of your score, and is arguably the easiest category to fix immediately. A missed payment could stay on your credit report for seven years.
  • Avoid taking on too much new debt. In this score range, your priority should be to get in the habit of making all your payments on time. This can be more difficult if you’re constantly taking on new debt. While this can help in the credit mix category, it can also hurt you in the amounts owed category, which accounts for a much larger portion of your score.

If You Have Good Credit (Above 700)…

If you’re already above 700, you’re almost there! You’ve likely built up good credit habits to get to this point, but you just need a little more to push towards 780. We recommend focusing on the following:

  • Continue to prioritize making payments on time. Again, since payment history is the largest part of your credit score, you absolutely cannot miss a single payment if you want to reach 780.
  • Keep your credit utilization low. Using some of your available credit is beneficial to your score, but using too much can hurt you. A good rule of thumb is to use no more than 10% of your available credit.
  • Consider taking on different forms of credit. At this point, you can start focusing on your credit mix. Different credit accounts can include personal installment loans, auto loans, and credit cards.

Conclusion and Next Steps

While the highest possible credit score you could achieve is an 850, there really isn’t any practical reason to do so. You’ll get access to the best loans and credit products with a 780, so that’s the score you should strive for.

Depending on where you are in your credit journey, we’ve highlighted three items for you to start focusing on today. If you take action, you’ll surely and steadily reach that coveted 780.


When doing research, Credit Help Info relies on credible and authoritative sites. These research sources are provided so that you can see exactly where we get our information.


About the Guest Author

Alexander Yu

Alexander Yu is a freelance writer who specializes in personal finance topics. In his articles, he applies his knowledge of credit and personal finance to help others secure a better financial future. In addition to freelance writing, Alexander also has an engineering degree from the University of California, Berkeley, and currently works as a programmer writer at Amazon.


Learn more about Alexander Yu


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