Key takeaways

  • Lenders usually consider a credit score of 800 or higher or higher “excellent credit.”
  • FICO defines excellent credit as 800 or above, while VantageScore defines it as 781 or above.
  • More lenders compete for your business when you have excellent credit.
  • You should still compare multiple offers to get the best excellent credit personal loan rates.

Borrowers with excellent credit — usually defined by a credit score of 800 or higher — can expect lower rates, longer term options and higher loan amount choices than borrowers with lower credit scores. In fact, the volume of loans made to excellent credit borrowers shot up by 20 percent toward the end of 2023, which may be a sign that lenders are seeking out higher quality credit for personal loans.

Borrowers who are eligible for personal loans with excellent credit may even find rates are the same or even lower than home equity loan rates, which have recently risen to multi-decade highs.

What is a personal loan for excellent credit?

An excellent credit personal loan is an unsecured installment loan designed for borrowers with credit scores above 800. Borrowers with credit scores in this range often have access to higher loan amounts, longer terms and lower costs than borrowers with good or fair credit. Although the funds can be used for standard purposes like debt consolidation, excellent credit borrowers may be more likely to use them for home renovations or to fund large expenses, like weddings or business inventory needs.

If your score is in the excellent credit score range, you’ve probably managed your payment history perfectly, use credit card sparingly and have a solid history of credit management with both installment debt, like car loans, or revolving credit card debt. The bottom line is lenders know you’re likely to repay your debt and they’ll reward you for your credit management skills by offering you more money for less than the average personal loan rate.

How excellent-credit loans differ from lower-credit score personal loans

Excellent credit shows lenders you know how to repay credit you take out. As a result, they’re more willing to offer better terms on larger loans because they know the odds you’ll pay them back as agreed are very high. This often means low rates, low or no fees and longer repayment schedules.

Lower rates

Personal loan interest rates can range between 6 percent and 36 percent depending on a number of factors. Excellent credit typically means you’ll be offered the lender’s most competitive rates. Average annual percentage rates (APRs) associated with personal loans for individuals with stellar credit ratings range between 10.30 percent to 12.50 percent. On the other hand, lower credit score borrowers may pay average rates as high as 32 percent.

Estimated APR by FICO credit score ranges

CATEGORY CREDIT SCORE PERCENTAGE OF PEOPLE IN THIS CATEGORY ESTIMATED APR
Excellent 800-850 21% 10.30%-12.50%
Very good 740-799 25% 10.30%-12.50%
Good 670-739 21% 13.50%-15.50%
Fair 580-669 17% 17.80%-19.90%
Very poor 300-579 16% 28.50%-32.00%

Source: Experian, Bankrate

Higher loan amounts

You may be able to borrow $100,000 or more with excellent credit. That’s significantly more borrowing power than the $50,000 cap at most fair or bad credit lenders. Keep in mind you’ll still have to qualify for a higher payment based on your income. The payment could be steep considering the maximum term is seven years, so make sure it fits your budget.

Longer term lengths

An excellent credit score makes it more likely a lender will extend terms past the five-year maximum most personal loan lenders offer. Check with your excellent credit lender to see if it offers terms beyond five years if you need a lower monthly payment for a higher loan amount.

How to increase your credit score and qualify for excellent-credit loans

If you haven’t reached the excellent credit score range yet, take some steps to improve your credit.

  1. Pay everything on time, all the time. Your payment history has the greatest impact on your credit scores. Set up automatic payments and keep your accounts to a minimum to avoid missing a payment.
  2. Keep your credit balances low or pay them off. Your credit utilization ratio should be at 30 percent or less. That means for every $10,000 worth of available credit you have you shouldn’t ever charge more than $3,000 at a time. Besides payment history, this factor has a major impact on how high your credit scores are.
  3. Don’t open a lot of accounts at once. Whenever you apply for credit, your score drops slightly. If you apply for several different credit accounts at once, your score may drop more rapidly because the credit scoring system thinks you’re taking out a bunch of new credit. Only apply for credit when you need it and avoid new accounts for small discounts at retail stores or online vendors.
  4. Check your credit report for errors. If your score is lower than expected, check for errors on your credit report. Reach out to credit report agencies and dispute any errors so they can be removed.

The bottom line

You will find better loan options with excellent credit. However, if you don’t qualify for an excellent-credit loan, you can still find a good deal. Shop around with different lenders to find the best loan package. If you don’t find rates and terms that work for you, work to increase your credit score before looking again.

Having an excellent credit score of 800 or is often the path to the lowest rates, longest terms and highest loan amount personal loan lenders offer. If you haven’t reached the excellent credit range yet, take some steps to improve your credit. Always shop around and compare offers from different lenders to find the best excellent credit loan for your financial plans.