Your credit score is based on your credit report, which is a comprehensive history of the your debts, including mortgages, credit cards, auto loans and any accounts that have gone into collection. Having a high credit score qualifies you for better interest rates on lines of credit.
FICO Score
The Fair Isaac Corporation, more commonly known as FICO, calculates the credit score that most lenders use when offering consumer credit. The FICO scale ranges from 300 to a maximum credit score of 850.
Prevalence
As of 2010, about 1 in 200 Americans manage to get a perfect 850 credit score at some point during their lives, according to CNN Money. The credit score may drop below perfect again if the individual opens a new credit account, has credit limits lowered or uses a higher percentage of available credit.
Significance
According to Bankrate.com, a credit score over 760 qualifies borrowers for the lowest interest rates on loans. Increasing your credit score over 760 is unlikely to get you a better interest rate, but does provide a buffer in case your score drops slightly.
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