Credit Score Range – Know the Facts

A lot of people these days can obtain their credit scores but have no idea what to do with it; in fact some of them do not even know what it is. Therefore it is quite appropriate that before you do anything with your credit score range you should actually understand what a credit score is and what  credit score ranges actually mean. Depending on how perfectly charges are disbursed by an individual, these details are computed in the form of a FICO or credit score range that starts from 300 to 850. This range is necessarily required when evaluating credit score because without it the score would be meaningless.

Why is it so important

credit score rangeCredit score ranges should in fact be considered vital and a highly important asset. You might not be able to acquire any sort of loan if your scores drop down to below a certain point, so always make sure you pay careful attention to them. When you are applying for a loan a majority of the lenders always pay close attention to your credit score. The only factor most of the lenders count are these scores, as they are what determine the sort of loan terms and interest rates you would be eligible for when receiving a loan. Since a credit record determines quite a variety of things  its importance should never be underestimated. These situations include:

  • Car Loans
  • Being hired for a job position
  • Down payment amounts
  • Insurance premiums
  • Mortgage types available when you buy a home

When you are trying to understand the credit score range it is always best to start from the top and work your way down. The most reliable score range currently which is most commonly being used is the FICO and the ranges  mentioned here are  based upon it.

800 to 850+ Credit Score

800+ credit scoreIf you want to have basically flawless credit then your credit score should range in between 800 to 900. Scores ranging in between 800 to 850 are quite common these days whilst  finding a credit score as high as 900 seems to be rare but there have still been reports of this high score. Often right from the moment a consumer’s credit profile has been established they may even  have an 800 credit score immediately but banks and lenders will still not actually consider it unless there is some credit history supporting this.

On the other hand, the lowest rates on loans such as auto insurance, mortgages and credit cards can be obtained by the borrowers who have years of solid history accompanying their 800 to 900 credit score. Almost 13% of the population currently have scores within this bracket.

720 to 799 Credit Score

720 credit scoreAnyone who wants to have great credit while benefiting from similar interest rates and approval rates that would be obtained with a credit score in the range of 800-850+, should have a credit score of between 720 to 799. A credit score in this bracket means that the credit check performed when applying for any loans is very thorough and in comparison with the 800-850+ range there can also be several differences in the pricing incentives as well. Nonetheless, consumers do not have to be concerned if their scores end up in this category because these are still considered to be excellent credit scores. In fact almost about 27% of the population has credit scores that are falling into this bracket from 750 to 799.

680 to 719 Credit Score

680 credit scoreConsumers usually have a good credit rating if their score falls in this bracket which ranges from 680 to 719. It is considered as a good credit score range. Borrowers in fact still get to qualify for a variety of loans and rental or auto leases even though it is not as perfect as the ratings mentioned above. On the other hand unlike excellent credit, borrowers with good credit would have to deal with slightly higher interest rates. Also particular types of financing like the lowest auto insurance premium or an A-paper mortgage loan cannot be availed by borrowers whose credit scores fall in this credit score range even though their score is not considered bad.

620 to 679 Credit Score

620 credit scoreFrom 620 to 679 is the credit score range where all the credit scores are considered to be ‘OK’. When borrowers who have an ‘OK’ credit score try to apply for a lease, loan or mortgage their chances of approval are slightly lessened whilst they have to face more restrictions. There is no reason for anyone to be concerned because only a few number of scores end up in this credit score range. Nonetheless evaluating your score and making an effort to improve it, is important. Since the lowest rates are not secured if your scores are in this range, you also do not lose too much money.

580- to 619 Credit Score

580 credit scoreThis is where “ok” and “good” turn to “bad”. Credit scores in this range are clearly below average, and you will have a difficult time securing a loan, or applying for a credit card. If you are able to secure financing, you’ll find higher interest rates for low credit scores. If your credit score falls in this range, you definitely need to evaluate your credit report and take measures to raise your credit score.

Many consumers with credit scores in this bracket are considered “sub-prime” and may have to work with bad credit banks and lenders to secure financing.

500 to 579 Credit Score

500 credit scoreHaving credit scores in the range of 500 to 579 is a rather bad sign. An individual’s credit report will most probably contain major derogatory marks such as bankruptcy, collection, charge off, foreclosures or late mortgage, if their credit score belongs to in this credit score range.

Below 500 Credit Score

500- credit scoreFinally it all comes down to the worst credit score which falls below the 500 bracket. Very little positive data and a lot of major derogatory marks would then be present in the credit report. With such a bad credit score there are certainly no hopes of availing a loan.

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