We all want a good credit score. No, we want a really good credit score! Then we can get the best interest rate on any loan whether it’s a car loan, mortgage or a mortgage refinance. Who wouldn’t want to get a lower monthly payment?
So what is a good credit score? Well the higher the better of course. The good range starts at 700, but in today’s economy you could very well need a higher score to get a loan.. More about that later.
Some time ago we decided to refinance our mortgage at a lower rate. After checking on bankrate.com to find the best APR rates available in our state, I phoned three of the banks that seemed to offer the best deals. Though one of the mortgage bankers said our credit score of 219 was outstanding none of the banks would match the exact rate posted on bankrate. They didn’t explain why it was different, but the rate each one quoted us was still pretty close to the rate listed online. We were happy to close on the refi with a deal that lowered our monthly payment quite a bit.
I was so happy we’d gotten such a great deal that I wanted to brag a little to my niece in the mortgage business. I mentioned that we’d gotten a good refi because we had a good FICO score. She asked what ours was and I let that number 719 drop and waited. Silence. How can it be? Was she not impressed?
Later I learned that our wonderful 719 was in the lower end of the “good score range.” She was classy enough to not mention that to us. After that we were more humble about our credit score,
not throwing it around not mentioning it to anyone anymore.
With many banks being reluctant to give loans lately a credit score in the low 700s might not qualify you for a loan at your chosen lender. Bankrate now shows what the APR rate would be for various FICO score ranges. That explains the difference in rate we got on our refi. In the good range are listed these levels: 700-719, 720-739, and 740+. Each level gives you a different rate, but it varies with the bank or lending institution also. Each bank has their own guidelines for making loans because each bank has different amounts of money available to lend. So don’t give up if you get turned down at one bank; just check with others until you find one willing to lend. Good luck and let’s all keep boosting our FICO scores!