The most important reason to have good credit is because it gives you a way to gain equal footing with the lender. Rather than their ‘doing you a favor’ with the loan, they are actively courting your business.

Good credit can save you thousands of dollars each year. So, what’s defined as good credit?

Anything above 700 is good, but 760+ is an A. You are considered the best of the best with a credit score above 760.

According to myFICO’s daily updated mortgage rate data, that 760 credit score translates to a 6.3 percent interest rate on a 30-year fixed, $216,000 mortgage. Meanwhile, a 700 score would get a 6.52 rate. A 620 score would pay more than a full percentage point higher, 7.89 percent, for that same mortgage.

By Philippe Volo
Compare Your Loans Contributing Editor