Here’s What Happens When Your Credit Score Rises by 10 Points

Your credit score is the sort of thing you may not pay much attention to until you’re ready to borrow money. But if you’re gearing up to apply for a new loan or credit card, then you may be inclined to see what that number looks like.

Credit scores range from 300 to 850, with the latter being absolutely excellent and the former putting you in a position where you’ll probably be denied a loan no matter what. But your credit score most likely falls somewhere in between those two numbers.

You’ll often hear that the higher your credit score, the easier it becomes to qualify for a personal loan or credit card. And if you’re signing a loan, the higher your credit score, the lower the interest rate you might be able to snag.

But boosting your credit score takes time, and you may find that your score only rises in small increments. In fact, you might see your credit score increase by 10 points from one month to the next. And while an increase of that size may not do you a world of good by itself, it’s definitely a solid start.

Will a 10-point credit score increase have any impact?

For the most part, a 10-point credit score increase probably won’t substantially change your likelihood of getting approved for a loan — especially if that increase leaves you in the same credit score category, so to speak. As an example, Experian says a credit score of 300 to 579 is poor. If your score goes from a 520 to a 530, unfortunately, you’re still in that same category, and your chances of borrowing money aren’t that great.

Along these lines, a credit score of 800 to 850 is considered exceptional. If your score goes from an 810 to an 820, it probably won’t make a difference, as you’d generally be in a great position to borrow in either scenario. It’s for this reason that consumers are often advised not to stress themselves out chasing perfect credit. A score of 850 is not going to have very different results than a score of 840.

In some cases though, a 10-point credit score boost might take you from one category into another. Going from a 730 to a 740, for example, bumps you from good to very good, as per Experian. But even then, that may not result in such a big difference when you go to borrow money. So all told, if your credit score rises by 10 points, you shouldn’t expect too much of an impact.

It’s still a great start

While a 10-point credit score increase may not do a ton for your ability to borrow, you should know that it’s still fantastic. If your credit score is at a 700 and you manage to boost it by 10 points every month over the next year, you’ll end up in an excellent position to borrow when you need to, and you’ll most likely qualify for competitive rates.

There are different steps you can take to boost your credit score over time, and the most important is to be timely with paying bills. You should also aim to keep your credit card balances low and check your credit report for errors every few months. These moves could make a big difference over time — and you might appreciate having made them when you’re offered an outstanding interest rate on a loan.

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