Table of Contents
What does a 735 credit score mean?
A credit score of 735 means that your credit reports show that you usually pay your bills on time. It indicates to lenders that you’re a low-risk borrower. In FICO and VantageScore, the main scoring models used by US credit bureaus, 735 is classed as a “good” credit score.
Check out the image below to see how your score compares with the average for different generations.
How a 735 credit score can benefit your finances
Having a good credit score means that you’ll pay less for loans and other types of credit than you would if you had a bad credit score. This is because you can take advantage of the low interest rates and the other financial benefits of a good credit score.
Loans and Credit You Can Get with a 735 Credit Score
|Credit Type||Loan Type||Eligibility|
|Installment loans||Mortgage||Eligible for all types of mortgages, including FHA-backed mortgages with a 3.5% down payment, conventional mortgages, VA loans, USDA loans, and jumbo mortgages|
|Car loan||Eligible, but you’ll have to pay a higher interest rate|
|Private student loan||Usually eligible without a cosigner|
|Personal loan||Usually eligible|
|Revolving credit||Unsecured credit card||Eligible, though you might not get the best interest rates|
|Secured credit card||Eligible|
|Personal line of credit||Usually eligible|
|Open credit||Cell phone contract||Usually eligible without a deposit|
|Utilities (gas, electricity, etc.)||Eligible, but you may need to pay a deposit if you’ve previously had any late payments|
|Charge cards||Sometimes eligible|
In addition to helping you qualify for better credit card and loan terms, having good credit can help you snag your dream job or apartment. This is because many landlords and employers run credit checks. A high score can also save you money on services like insurance.
However, if you want the very best rates and terms on your loans and credit cards, then there are still some things you can do to further improve your credit score. This is easy to do once you understand how credit scores work and how they’re calculated.
How your 735 credit score was calculated
As mentioned earlier, the two main credit scoring models are FICO and VantageScore. Although the two models have minor differences, both calculate credit scores based on the following factors:
- Payment history: Late payments lower your credit score. The later the payment, the more damage it will do. Charge-offs, collection accounts, and bankruptcies are even more damaging to your score.
- Credit utilization rate: This refers to the proportion of your available credit that you’re using (also known as your debt-to-credit ratio). A lower utilization rate is better for your credit score. Many experts recommend keeping yours below 30% (meaning you should try not to reach a $3,000 balance on a credit card with a $10,000 limit). VantageScore recommends keeping your credit utilization even lower, under 10% if possible. 1
- Length of credit history: This is determined by the age of your oldest and newest credit accounts as well as the average age of all of your accounts. Old accounts that you’ve had for many years boost your credit score, whereas new accounts lower it.
- Credit mix: Your credit score will be lower if you don’t have a balanced mix of revolving credit accounts (e.g., credit cards and store credit) and installment accounts (e.g., mortgages, car loans, and student loans).
- New accounts: When you apply for a credit card or loan, the lender will run a credit check. This will trigger a hard inquiry Hard inquiries take a few points off your credit score, and the effect lasts for up to 12 months. 2 Actually opening the account can further hurt your score and have even longer-lasting effects.
A credit score of 735 indicates that you have a relatively good credit history. Nevertheless, one of the following factors may be keeping you from attaining a higher score:
- Derogatory marks: A derogatory mark (negative item in your payment history, such as a missed payment or collection account) can have a major and long-lasting negative effect on your credit score.
- Insufficient credit history: A thin credit file can bring down your credit score even if you don’t have many derogatory marks. It could be that you haven’t used your credit enough to establish a positive enough payment history or that you don’t have a good mix of different types of credit.
The good news is that you can recover from both situations. However, before you worry about improving your credit score, it’s important to make sure you’re not doing anything to damage it.
To maintain your good credit score, follow these tips:
- Pay all of your bills on time.
- Avoid opening any new credit accounts (unless you need to build credit).
- Avoid closing old accounts.
- Send a debt validation letter demanding proof of any future debts that anyone tries to collect from you according to your rights under the Fair Debt Collection Practices Act (FDCPA).
VantageScore vs. FICO credit score calculation methods
VantageScore and FICO take the same factors into account to produce your score, but they weigh them slightly differently (which is why you might have different credit scores in the two models). Here are just a couple of the differences between FICO and VantageScore: 3
- VantageScore groups the length of your credit history and your credit mix into one category called Depth of Credit.
- In addition to your credit utilization (represented as a percentage), VantageScore also looks at your current balances and your remaining available credit (represented as dollar figures).
The tables below show how the models weigh your financial decisions to produce your score:
|Payment History||Amounts Owed||Length of Credit History||Credit Mix||New Credit|
|Payment History||Credit Utilization||Depth of Credit||Recent Credit||Balances||Available Credit|
Putting your 735 score in context: how it compares to other scores
The table below shows the average VantageScore and FICO credit scores among US consumers, as well as your credit rating in each of these models and how far your 735 credit score is from the next scoring category.
|Your Rating||Points to Rating Upgrade||Points to Rating Downgrade||Average Score in US|
Given time, you can get your credit score into the top ranges. This can mean developing your credit profile if you don’t have much of a credit history or recovering from negative marks that brought your score down.
Regardless of your circumstances, there are steps that you can take immediately to increase your credit score.
How to improve your 735 credit score
With a 735 score, you’re already doing very well! But there are steps you can take to improve your credit score further.
Ways to raise your credit score quickly
If you’re looking to catapult your already-good 735 to even greater heights very quickly, that may be difficult. Nonetheless, you can try the following methods to raise your credit score extremely fast:
1. Dispute errors on your credit report
If you manage to get any derogatory marks (aka negative items) removed, you’ll definitely boost your score beyond 735 almost immediately.
2. Get credit for paying rent and utility bills on time
Your rent and utility bill payments generally won’t be reported to the three credit bureaus (unless you’re seriously delinquent). But now there are some services that will allow you to do just that. Provided you pay on time and in full each month, this is probably the easiest way to add some quick points to your 735 score.
- Try Experian Boost: A free service you can use to boost your credit (only with Experian, not the other two credit bureaus) for making certain types of payments like utility bills (and even subscriptions to services like Netflix, HBO, and Hulu).
- Try rent and bill reporting services: Paid services like PayYourRent will report your rent payments to all three credit bureaus and others (like eCredable) will report your utility payments to one or two of them. Before signing up for these services, check to make sure your landlord or property management company isn’t already reporting your rent and utilities.
While you undoubtedly want to build up credit as fast as you can, the reality is that if the system were easy to game, it wouldn’t be stable enough to use for lending decisions. Be patient and make slow and steady progress growing from 735.
Protect your score and build it up over time
If you already have a 735 credit score, you’re already well on your way to achieving an excellent credit score by simply continuing to practice good credit habits. Here are some dangers to watch out for:
- Don’t overlook your credit mix: For the best possible score, you need a mix of loans and credit cards. However, that shouldn’t be the sole reason you apply for a new credit card or loan (both of which will hurt your credit in the short term before they help it).
- Don’t overspend on your credit cards: The easiest way to accidentally damage your credit score is to overspend on your credit cards. Even if you can easily afford it, if you decide to book plane tickets, then buy a TV and a new couch in a multi-month spending spree, it’ll set your 735 credit score back significantly.
- Never, ever pay late: One single 30-day late payment will do massive damage to your 735 score because it’s already so high. Then it will take months or years to recover from that hit.
Those are the main strategies for someone with a 735 score, but we recommend reading more about how to build up your credit to get the full picture.
Life with a 735 credit score
As long as you keep up the good habits that got you your high credit score, you’ll have access to a variety of loans and other types of credit.
Getting auto loans with a 735 credit score
There is no credit score too low to get an auto loan, and you’ll be able to get one when your credit score is 735. However, if you want the best interest rates on the market, you’ll probably need to wait until you get your score a bit higher.
According to a 2020 quarterly report by Experian, people with credit scores of 661–780 (referred to as prime borrowers) had average interest rates of 5.59% on their used car loans and 3.69% on new car loans, whereas people with credit scores of 781–850 (super-prime borrowers) received average rates of 3.80% and 2.65%. 4 Although this is a relatively small difference, waiting until your score improves could still potentially save you hundreds of dollars on a car loan.
If you’re set on getting an auto loan right now, then pay as large of a down payment as you can afford and consider getting prequalified or applying for a preapproval from your bank or credit union to increase your bargaining power.
Getting a mortgage with a 735 credit score
You’re eligible for any type of standard mortgage if you have a credit score of 735. The following are all the mortgages you can get:
- FHA loan: Your credit score qualifies you for maximum financing (a down payment of only 3.5%) on a mortgage backed by the Federal Housing Administration (FHA). It’s worth noting that you won’t be eligible for an FHA-backed loan if you had a foreclosure in the past three years or filed for chapter 7 bankruptcy in the past two years. 5
- Conventional mortgage: Most lenders will consider giving you a mortgage because your credit score is above 620, which is the minimum score required by the Federal National Mortgage Association (Fannie Mae) and Federal Home Loan Mortgage Corporation (Freddie Mac). 6 7
- VA loan: The US Department of Veteran Affairs backs VA home loans, which are exclusively for members of the military (both current and former) and their families, and they don’t impose a minimum required credit score. 8 They instead leave it up to lenders, most of whom will be willing to issue you a mortgage with a credit score of 735.
- USDA loan: As long as you have two tradelines that have been open for 12 months in the past two years, you’ll meet the credit requirements for a USDA loan because your credit score is above 640. 9 However, you won’t be eligible if you have an outstanding judgment, and you might have a hard time qualifying if your credit history shows a foreclosure, bankruptcy, or debt settlement in the past 36 months.
- Jumbo loan: Compared with conventional conforming mortgages, jumbo mortgages are larger, and they exceed the maximum value that Fannie Mae and Freddie Mac will accept when buying mortgages from lenders. Because jumbo mortgages come with a higher risk, lenders will only consider giving you one if your credit score is at least 700. In some cases, you may even need a score of 720 or 740.
Renting with a 735 credit score
You often need a credit score to rent a house or apartment since many landlords run credit checks on prospective tenants. Thankfully, you should have no problem passing a credit check with a credit score of 735.
Getting a credit account with a 735 credit score
As a prime borrower, you’ll have plenty of options when looking for a new credit card. However, you might not qualify for the top rates that card issuers reserve for people in the highest credit score range.
The types of credit cards you can get with a credit score of 735 generally fall into two categories:
- Secured credit cards: These cards require a security deposit, which your lender will use as collateral. The amount you put down will usually be your credit limit. Secured cards are a low-risk option if you want to build credit while ensuring that you don’t spend beyond your means.
- Unsecured credit cards: These cards don’t require a deposit. Your card issuer will set your credit limit according to how creditworthy they perceive you to be. In many cases, these cards offer cash back on certain purchases and other rewards.
Which type of credit card is best ultimately depends on your financial situation and your reason for opening a new credit account. If you’re good at controlling your spending, then it’s a good idea to use your good credit score to take advantage of the potential rewards and higher credit limit that come with an unsecured card.
On the other hand, if your main goal is to build credit and you’re worried about overspending, then a secured credit card may be your best bet.
Don’t apply for a credit card if you know you don’t meet the company’s requirements—both in terms of your credit score and other factors they might consider. Most applications will trigger a “hard inquiry,” which will cause your credit score to temporarily drop and may increase the likelihood that your next credit card application will be rejected. To find out if the card issuer has a minimum credit score, check their website or give them a call.