Once You Hit This Credit Score, You'll Unlock The Best Interest Rates

Good credit scores can be a real lifeline when times get tough. Experian, citing FICO® data, says a credit score above 670 lands you in the "good" category, while 740 is "very good" and 800 is "excellent." People within these ranges can get the best interest rates on mortgages, car loans and credit cards. Sure, lenders look at other stuff — your income, how long you want to borrow for and your down payment — but hitting that 740 mark is a huge win. It can be the difference between a 4% and 5% mortgage rate, which is thousands of dollars saved during the lifespan of the loan.

On a $400,000 mortgage spread over 30 years, a 4% rate costs you about $287,478 in interest. But if that rate climbs just one point to 5%, you'll end up paying roughly $373,023 — meaning an extra $85,545 disappears from your pocket. That gap isn't random. Lenders see borrowers with top-tier credit as safer bets, so they reward them with lower rates. This is justified because it can be really hard trying to avoid things that tank your credit score.

The Mortgage Reports in January 2025 noted that once your credit score hits 760, you unlock the lowest mortgage rates. For context, borrowers with scores 760 and above get their mortgage at a 7.24% interest rate, while those in the 700 to 759 have it at 7.45% interest rate. That 0.2-point gap may seem small, but on a $300,000, 30-year loan, it can mean roughly $12,000 more in interest over the life of the mortgage.

If you are not at 670 or over, consider and FHA loan. The Federal Housing Administration (FHA) loans are pretty friendly to lower credit scores. According to FHA guidelines published in 2023, you can get a loan with a 580 credit score and just 3.5% down. But don't let that low barrier fool you; you'll pay a 1.75% upfront mortgage insurance premium (UFMIP), plus an annual fee of 0.45% to 1.05% of the loan amount.

If your score falls between 500 and 579, you'll need 10% down. Also, the upfront insurance rate is fixed at 1.75% and the annual premium ranges from 0.45% to 1.05%, depending on the loan terms and down payment. So sure, you can qualify with less credit history, but you'll face extra costs from both the required insurance and a higher interest rate.

A credit score of 740 or above generally unlocks the lowest rates on almost every loan out there — from car financing to personal lines of credit. For example, NerdWallet reported that borrowers at 740 can see their average APR on a new car at 6.40% and 9.9% on a used car, while anyone under 600 might be stuck paying 13% to 19% or more. On a $35,000 car loan, that difference can save you nearly $6,500 in interest over five years. Credit card companies notice, too. With that top-tier score, you're more likely to land cards offering 0% intro APR promotions. Private lenders play by the same rules in small-business financing. NerdWallet's May 2025 data states that if you hit 720 or above, you'll lock in personal loan rates around 13.88%. Drop into the 630 to 689 zone, and you're often paying 19.77%. 

On student loans, private lenders set rates by risk. According to NerdWallet's 2025 survey comparing students loans, borrowers with the "strongest profiles" (which typically means a FICO score in the "very good" to "excellent" range, 740 and above) can land rates at a minimum of 4.6% for fixed-rate loans across 24 private‐loan lenders. Put all those savings together and a top-tier score doesn't just lower your bills, it gives you the freedom to refinance smarter or back your next big idea without breaking the bank.