Case study: How to leverage your excellent credit score

If you’re currently sitting on an excellent credit score–nice work! It generally means if you have the serviceability to pay back a loan, your credit score usually won’t be what holds you back from being approved.

But did you know that there are plenty of perks that come with an excellent credit score and you may be able to take advantage of these to get better deals?

Understanding the credit score ranges

Your credit score isn’t a static number. It changes over time depending on the information that is contained in your credit report.

There are five credit score bands that your score can fall into.

  • Excellent: 800-1,000
  • Very good: 700-799
  • Good: 625-699
  • Fair: 550-624
  • Below Average: 0-549
An excellent credit score means you are highly unlikely to have any adverse events harming your credit score in the next 12 months.

A real-life example of someone with an excellent credit score

Cath is in her mid-thirties and is a property investor who has several loan accounts with her bank. She always pays her loans on the due date via direct debit and has a credit card with a balance that she pays off in full each month.

When her bank introduced a new credit card with higher rewards earning points she was offered the chance to take up the card, even though her credit limit was below the standard amount usually needed to qualify for this type of card.

This meant she was able to earn points a lot faster, which has covered lots of interstate travel and hotel stays over the years.

Her excellent credit score means that she is the type of customer that lenders want, so they will often offer discounts on interest rates and fees to keep her business.

Factors that contribute to your excellent credit score

In the case study above, Cath has proved that she has a good history of paying her credit off on time and she has never missed any payments or defaulted on her loans. 

But just because she has an excellent score now doesn’t mean she can be complacent. She should be aware of what factors can cause her score to increase or decrease over time.

These factors can cause your credit score to increase.

  • A good history of making payments on time
  • Paying off outstanding loans
  • Paying a default
  • Bringing accounts up to date
  • Negative data expiring and being removed from your report.

These factors can see your credit score decline:

  • A mistake has been made on your credit file which you will need to have fixed. Errors could range from a simple mistake such as a duplicate entry or incorrect details, or it could mean something more serious like your identity being stolen
  • Defaulting on a credit account
  • Submitting multiple credit applications in a short period of time
  • Having excessive open credit accounts
  • Having too much unsecured credit
  • Not paying a bill and having it go to a debt collection agency
  • Having a combined credit limit that is viewed as being too high
  • Being declared bankrupt.

How to leverage your excellent credit score for extra perks

In Cath’s case study, her excellent credit score allowed her to access a credit card offer that was not available to the general public.

If you too have an excellent credit score it’s worth picking up the phone and trying to renegotiate the standard terms on a credit card. You might be able to score a reduced interest rate, lower fees or better rewards point options.

Alternatively, Credit Card Compare is often able to access special offers from credit card providers that are targeted towards those who meet an income eligibility criterion and have a very good or excellent credit score.

Your great credit score allows you access to a wider range of lenders and you will often qualify for a higher credit limit.

You can also negotiate a better deal on your utilities and phone contracts as they also use your credit score before approving a contract with you.

If looking for a personal loan you might consider a peer-to-peer loan. This is a newer type of lending where your interest rate is based on your credit score. The higher your score, the lower your interest rate will be, which could make it an alternative way to access an affordable unsecured personal loan.

Even if you have a great credit score it is beneficial to track it to make sure no errors appear on your report, and that it includes information you would expect to see there. 

With our free credit score tool, we can notify you each time your score changes.