When you’re thinking about credit repair most of the time you’re focused on your credit score. There’s good reason for that because your credit score is a signal to lenders that tells them your credit worthiness, or the “risk factor” involved with giving you a loan or credit. Your credit score is a 3-digit number that is calculated by using data contained within your credit report. Experian, Equifax, and TransUnion are the three credit reporting agencies that determine your score. Your credit score takes your payment history, credit utilization, the length of time accounts have been open, and the mix of credit and credit inquiries into consideration.
Credit Score Ranges
A FICO score is a well-known measure created by the Fair Isaac Corporation, and is used by credit agencies to determine the risk of loaning to a borrower. The VantageScore was developed through a partnership between Equifax, Transunion, and Experian. Both FICO and VantageScores range from 300 to 850. There are slight differences between the two, but in both cases the higher the credit score, the lower the risk to the lender. We’ll use FICO scores here to better understand the ranges and what they mean when it comes to understanding your credit score.
Exceptional Credit Score: 800-850
If your credit score in this range, you are considered consistently responsible when it comes to managing your borrowing. You will be thought of as prime candidate to qualify for the lowest interest rates when applying for loans and credit.
Very Good Credit Score: 740-799
A credit score in this range shows that you’re generally financially responsible when it comes to money and credit management. Most of your payments, including loans, credit cards, utilities and rental payments are on time. In addition, your credit card balances are low compared to the credit account limits.
Good Credit Score: 670-739
When your score is in this range you are still slightly above the average U.S. consumers – the national average FICO score is 695. You may still get competitive interest rates, but are unlikely to get the best available, and it may be more difficult to qualify for some types of credit.
Fair Credit Score: 580-669
Credit scores in this range are considered to be “fair” or “average.” If you’re in this range you may have a few dings on your credit history, but no major delinquencies. You’ll still be able to get credit from lenders, but not at very competitive rates.
Poor Credit Score: Under 580
If your score is under 580 your credit history has some significant damage. It could be the result of multiple defaults on different credit cards from various lenders. It may also be the result of a bankruptcy which remains on a credit record for up to 10 years. Borrowers in this range have very little chance of getting new credit.
There you have it. These are the ranges of credit scores and what they mean. If your score is lower than you’d like the good news is you can always improve it. There are a lot of techniques and strategies people can use to get their credit score back up to where they want it. Working with a credit repair company can fix your credit faster than you think. Give us a call today and we’d be more than happy to discuss plans and options you have to get back to where you want to be in a timely manner. (877) 772-7312