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| All content presented here and elsewhere is solely intended for informational purposes only. The reader is required to seek professional counsel before beginning any legal or financial endeavor. |
If your credit score is 736 – congratulations. A score of 736 is considered “good” using the VantageScore and FICO algorithms. Because the FICO score is used in 90% of lending decisions, with a 736 FICO score, you are well on your way to attaining a “very good” or “excellent” rating, which will get you even better loan terms.
Key Takeaways
- A credit score of 736 can earn you better loan terms, like lower interest rates
- Checking your credit score regularly can help you find errors that can lower your score
- Discipline and commitment will help you maintain or improve your credit score
What Can You Get with a 736 Credit Score?
While a 736 credit score isn’t yet considered very good or excellent, you’re well on your way up the credit score ladder. Having a score of 736 does carry benefits that far outweigh those that come with having a fair credit score. These benefits include:
- Larger loan amounts. Being in the “good” range earns you access to higher loan amounts. You can borrow more to buy a new home or car, get a larger student loan, or be issued credit cards with higher credit limits. And as FinImpact details, your may also be approved for personal loans that you may not have been granted without a 736 credit score.
- More favoriable loan terms. A good FICO score of 736 will also get you more favorable terms when you borrow, particularly lower interest rates. For example, being considered a reasonable credit risk can shave 5% or more off the interest rate you’ll pay for a credit card and get you a better rate when you’re purchasing an automobile or home.
- Additional job opportunities. Some employers will also check your credit score when you apply for a job and partially base their hiring decision on its strength. They believe that someone who handles credit responsibly is more trustworthy than someone who doesn’t and may pose a smaller risk of criminal financial activities caused by financial desperation.
- Easier insurance application approval. Even insurers, particularly life insurance companies, consider your credit score when deciding whether or not to issue you a policy. Applicants with poor credit are considered more likely to submit fraudulent claims, which can be very costly to an insurer.
How to Get a 736 Credit Score: Tips and Strategies
If you have a poor to fair credit score and want to reach a 736 FICO score, it can be done by following some fundamental financial steps.
- Pay your bills on time: Being late or missing payments is a “credit killer.” It will lead to an increase in the interest rate you’re paying on a credit card, lead to less favorable terms on future loans, and eventually result in having your account sent to a collection agency.
- Reduce your credit card balances. Lenders carefully consider your “utilization rate,” which is the percentage of your credit limit you’re using. The target rate is 30% (e.g., up to $3,000 used on a credit card with a $10,000 limit)
- Don’t apply for too many credit cards at once. Applying for multiple credit cards at the same time is a red flag for lenders. It is a possible signal of an applicant having financial difficulties and needing to use credit as a “quick fix.” It will hurt you in your quest to achieve a credit score of 736 or higher.
- Have several different types of loans. Being current on different types of loans will help your credit score. If you can, establish credit with different types of loans, such as credit cards, car loans, a mortgage, and personal or student loans.
- Dispute inaccurate information on your credit report. Human error is always a concern with data entry, and your credit report is a collection of data entry. Check your report for errors regularly and dispute any inaccurate information. Most lenders are accommodating in correcting mistakes.
- Leave old credit accounts open. Don't close an account if you’re not using a particular credit card you’ve had for a while. The length of your credit history is an important factor in your FICO score, and older accounts lengthen your credit history, even if you’re not using the card or account.
- Check your credit report frequently. You can get a free credit report every month from annualcreditreport.com through the end of 2023, so there’s no excuse not to check your credit report at least quarterly. This way, you can make sure the information on it is accurate, and accounts aren’t being opened without your knowledge.
How to Scale Up and Achieve an Excellent Score
Like all good things, raising your credit score takes time. You can’t go from having a good credit score to an excellent one in just a few weeks. A credit score of 800 or higher can take months of time and energy, but there are certain strategies you can implement that will help.
- Pay down revolving account balances. Even if you’re not behind on making your monthly payments, having high account balances can hurt your score. Lowering and maintaining smaller balances will help you improve your scores.
- Limit how often you apply for new accounts. When you apply for a new account, a “hard credit pull” is usually performed by the lender, which can lower your score, depending on what type of credit or loan you’re applying for. When you’re shopping for a mortgage and several mortgage lenders do a hard credit pull, that usually won’t count against you.
- Consult with a financial advisor or non-profit credit counselor. If you’re having difficulty establishing or staying on a budget and late payments are hurting your credit score, consider consulting with a professional who can help you get and stay on track. The more disciplined your budgeting and spending is, the better the chance of scaling up your credit score.
A 736 Credit Score vs. Other Credit Score Ranges
Knowing your credit score is critical to maintaining or improving it.
According to credit rating service Equifax, this is the range of FICO scores:
300 to 579: Poor
Being approved for new credit will be difficult if you're in this range. However, following the steps above will improve your credit score.
580 to 669: Fair
In this range, you’re going to be considered a higher risk to lenders. Statistically, you’re more likely to be late with payments or default on a loan. If your credit is fair, strive to reach the good range. It will positively impact your ability to borrow and your loan terms.
670 to 739: Good
This is the range a score of 736 falls in. By being here, lenders are much more likely to extend you additional credit and lower their interest rate to compete for your business. The good range is a solid place to be.
740 to 799: Very Good
You’re making serious progress in this range. You are one rung away from the top of the credit score ladder. Re-read the list under “How to Get a 736 Credit Score: Tips and Strategies” and see if there is an area you could improve upon. If you’re doing everything right, keep making your payments on time, and you’ll eventually be rewarded with a higher score.
800 to 850: Excellent
You’ve reached the top of the hill with a score of 800 to 850. Keep practicing the good habits you’ve established to maintain your standing. You’ll be happy you did the next time you apply for a mortgage or other major purchase.
Your credit score heavily impacts your interest rate with a given lender or card issuer. Having poor to fair credit will necessitate applying for a “secured credit card,” which you can obtain by depositing money with the lender. Interest rates for secured cards can fall between 26% and 39%.
Conversely, being in the good to excellent range, which includes a score of 736, will get you more competitive interest rates on credit cards, typically 13% to 22%. Membership in this range has its privileges.
What is the Difference Between a Credit Score and a Credit Report?
As we’ve seen, a credit score is a three-digit number between 300 and 850. Every consumer has a credit score called a FICO score and a VantageScore. You’re probably more familiar with FICO because it’s more commonly used by lenders.
Credit card companies and other lenders use credit scores to gauge how much risk a potential borrower poses. Collection agencies also use credit scores to evaluate how likely someone is to pay back a defaulted account.
Many landlords also look at an applicant’s score and use it as an indicator of their financial responsibility.
Your credit report is the story behind the numbers. It’s compiled by each of the three major credit bureaus, Experian, Equifax, and TransUnion, and is reviewed by lenders to evaluate your creditworthiness.
Knowing your credit score is important because measures how responsibly you’ve used credit in the past. However, it’s your credit report that determines whether or not a lender approves your application.
Your credit report is a compilation of information concerning your credit history, including:
- Outstanding and past lines of credit
- Payment histories
- Third-party collections
- Lender inquiries
- Public records concerning bankruptcies and repossessions
Your credit report does not include your credit score.
Here are three ways to find out your credit score:
- Use a free “credit scoring” website
- Ask your credit card provider
- Consult a nonprofit credit counselor
Ignorance is not bliss when it comes to knowing your credit score and looking at your credit report. Knowing and checking your credit score for sudden or dramatic changes can alert you to check your credit report for unusual activity that could indicate fraud. This will allow you to file a dispute and get damaged credit back on track.
Organizations That Can Help You Improve Your Credit Score
If your credit score is holding you back and impacting your lifestyle, there are organizations that can help you get a better handle on your credit.
One of the oldest is the National Foundation for Credit Counseling (NFCC). They can help you learn your credit score and take steps to improve it and the information contained in your credit report.
Other resources that can help by providing practical advice or hands-on assistance are:
Bottom Line
Your credit score is something you can control. Learning your score, checking your credit report regularly, and practicing good credit habits (paying bills on time, having a low utilization rate, keeping old accounts open, etc.) will enable you to improve your credit score and enjoy all of the benefits that come with it.
But remember, building excellent credit takes time and consistency. As Aristotle wisely stated, “We are what we repeatedly do. Excellence, then, is not an act, but a habit.”
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