Generally speaking, a Credit Score ranges from 300 to 850. It is a numerical rating that is used to measure a person’s creditworthiness. If you have a higher credit score, you stand the chance of getting a loan at a low-interest rate. While a low Credit Score is likely not to get a loan and might get a loan at a high-interest rate. The question now is what is a Good Credit Score? A credit score from 670 to 739 is considered to be a Good Credit Score.
Although the Credit Scoring model varies from Lenders to Lenders a good Credit Score generally is between the ranges of 670 to 739. A Good Credit Score can help you get access to loans in times of unexpected circumstances compare to a person with a bad Credit Score.
Aside from lenders, many employees, Landlords, insurance companies check your credit score to determine if you are qualified for a job, can become a potential tenant and a policyholder.
What is a Good Fico Credit Score?
FICO is a top analytic company that helps business owners makes the right decision for higher growth, profit, and customer satisfaction. According to FICO, a Good Credit Score is between the ranges of 670 – 739, a very good Credit Score is between 740 – 799 and an exceptional Credit Score is between 800 – 850.
A poor Credit score on other hand starts from 300-579, while a fair Credit Score starts from 580 – 669. Based on this analysis, we can say that a Good FICO Credit Score is 670 – 739.
What is Vantage Score?
VantageScore is another data analytics company that has its own Credit Score Scoring model. It, however, uses 300 to 850 ranges just as FICO. A Good Credit Score by Vantage Score is considered as 661 – 780, while an excellent credit score is between the ranges of 781-850. It bad credit score starts from 500 to 600, Fair from 601- 660, and a very poor credit score is 300-499.
Why is having a Good Credit Score Important?
There is the importance that comes with having a Good Credit Score. Aside from the fact that it can help you to achieve your financial and personal goals; it can impact directly how you have to pay Interest or fees once your loan has been approved.
In addition, a Good Credit Score can help you get a desirable car loan or lease. As mentioned earlier, you can be qualified for a particular job; if you have a great Credit Score as well as determine your eligibility for an insurance policy.
Factors that Affect your Credit Score
Several factors affect your Credit Score and it is important you know these factors. The factors that affect your Credit Score include;
- Payment History; one of the factors that help a lender determine your credit score is your payment history. Late payment affects your credit Score and might lead to your having a poor credit score.
- The amount owed; the total amount owed also stand a chance of affecting your credit score negatively.
- Your credit History Length; how long you have had your credit account can also determine your credit score range. People with an old account have a higher credit score.
Other factors that can affect and determine your credit score include, Credit Mix and how frequently you have applied for Credit.
How to Improve your Credit Score
If you have a Good Credit Score, you can still work harder to get an exceptional Credit Score and if you have a Poor Credit Score, you can also work hard to get a great one. Simply follow the steps below;
- Make sure to pay your debt on time as late payments might affect your credit score.
- Keep your credit card balance low. Having a low Credit balance can help your credit score.
- Apply for credit when necessary or needed. Applying for different types of loans can affect your credit score, so apply when for loans when needed.
Lastly; Monitor and track your Credit Score as this will help you know if you’re making progress and if you are qualified for a particular loan.
Commonly Asked Questions about Credit Score
Is 700 a Good Credit Score?
A Credit Score as earlier stated is between the ranges of 300 to 850. According to FICO, any credit score from 700 and above is considered to be a good credit score. In other words, 700 is a good credit score and with this type of credit score you can easily get loans from lenders at a low interest rate.
What is a Bad Credit?
A bad Credit score is said to be below 630 based on FICO and VantageScore scoring model. In simple terms, a credit score between 300 to 559 is considered to be a poor credit score.
What is a Fair Credit Score?
Unlike a bad credit score that starts from 300 to 559. A credit score between the range of580to 669 is a FICO Fair credit score but a fair credit score by VantageScore falls between 560 to 689.
How do I know I have an Excellent Credit Score?
An excellent or exceptional Credit score lies between the range of720 to 850 based on the FICO scoring model. On the other hand, an excellent VantageScore credit score ranges from 760 to 850.
Can I get a Loan with a Bad Credit Score?
It is, however, possible to get a loan with a bad credit score from online lenders like LendingClub, LendingPoint, Bad credit loans, and more. However, you will get loans at higher interest rates and other factors might be considered before your loans might be approved. It is advisable to compare interest rates before applying for any loan whether you have a bad credit score or not.