Is 706 a Good Credit Score?

By Melissa Brock

A credit score of 706 is considered good, and it may qualify you for more competitive rates and lending options. However, it’s not high enough to land in the very good or exceptional credit score range. As a result, you may not get the best rates possible, and you might not qualify for premium credit cards.

Let’s take a deeper look into the meaning of a 706 credit score and what you need to know about your borrowing options.

What Does a 706 Credit Score Mean?

Your credit score is a three-digit number that represents your creditworthiness, or how likely you are to repay the money you borrow. The two most common credit scoring models are FICO® and VantageScore. FICO, which is used in most lending decisions, calculates your credit score based on your payment history, amounts owed, length of credit history, credit mix, and new credit.

Here’s a look at how FICO Scores are categorized:

•   Poor: 300-579

•   Fair: 580-669

•   Good: 670-739

•   Very Good: 740-799

•   Excellent: 800-850

A 706 FICO Score shows lenders that you’re a responsible borrower. As we mentioned, they may offer you credit products, though you might not get the lowest interest rates.

What Can You Get with a 706 Credit Score?

Can you get a credit card, auto loan, mortgage, or personal loan with a 706 credit score? Here’s a closer look at each.

Can I Get a Credit Card with a 706 Credit Score?

There’s no universal credit score required to get approved for a credit card. That said, with a credit score of 706, you can likely qualify for a number of credit cards, including travel credit cards and cash-back credit cards.

Can I Get an Auto Loan with a 706 Credit Score?

A 706 credit score can increase the chances you’ll get approved for an auto loan. What’s more, you’ll likely be offered a competitive interest rate.

Can I Get a Mortgage with a 706 Credit Score?

You can qualify for a mortgage with a 706 credit score. You may even qualify for a jumbo loan that exceeds the standard loan size. Let’s walk through some common mortgage loan types and their credit score requirements.

•   Conventional loan: Conventional loans typically require a 620 minimum credit score for fixed-rate mortgages, and 640 for adjustable-rate mortgages. A 706 credit score can give borrowers better interest rates and terms.

•   FHA loan: These are guaranteed by the Federal Housing Administration. To get an FHA loan, you’ll typically have to have at least a 500 credit score (with a down payment of 10% or higher) or a 580 credit score (with a 3.5% down payment).

•   VA loan: This type of loan is backed by the Veterans Administration, and it’s for active-duty military members, veterans, and surviving spouses. The VA doesn’t set a minimum credit score requirement, but lenders generally want to see at least a 620 credit score.

•   USDA loan:The U.S. Department of Agriculture (USDA) backs these loans, which encourage purchasers to buy homes in eligible rural areas. Typically, you’ll need a credit score of 620 or higher to qualify.

Can I Get a Personal Loan with a 706 Credit Score?

A personal loan is a type of installment loan — you receive a lump sum and repay your loan every month. You can use the funds for just about anything, including consolidating debt, travel expenses, and large purchases.

Note that personal loans often carry lower interest rates than credit cards.

Each lender has its own credit score requirements for personal loans, and they also weigh other factors, including your debt-to-income ratio and employment. However, a 706 credit score should be more than enough with most major lenders.

It’s a good idea to shop around. You may also want to use a personal loan calculator to determine how much your monthly payments will be based on the rates and terms you’re offered.

How to Build Your Credit

While a credit score of 706 is good, boosting it even higher could qualify you for the best rates and terms. Here are some strategies to consider:

•   Make on-time payments: Consistently making payments on time can help you increase your credit score.

•   Pay down balances: Try to keep your credit utilization rate low — ideally, aim to use no more than 30% of your credit limit. Don’t close accounts: Keep old credit accounts open, as this will lengthen your credit history.

•   Diversify your credit: Responsibly managing a variety of credit types can help boost your credit score.

•   Limit credit applications: Lenders perform a hard inquiry on your credit when you apply for a new loan, so try minimizing the number of times you apply for credit. See if your lender offers prequalification instead, which involves a soft credit check.

•   Check your credit report regularly: Inaccuracies can affect your score, so check your report and dispute any inaccuracies with the credit reporting agencies.

The Takeaway

So is a 706 credit score good or bad? Put simply, it’s considered good, and you may be able to qualify for a range of credit options. But to help land the best rates and terms, you’ll want to build your score to the “very good” (740-799) or “exceptional” (800+) category. Making on-time payments, paying down debts, and keeping older accounts open can all help you build up your score.

Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. See your rate in minutes.

SoFi’s Personal Loan was named NerdWallet’s 2024 winner for Best Personal Loan overall.

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