How Good is Your Credit Score?

Buying a house or a car? Taking out a loan? Select your 3-digit score to learn about how lenders see your credit score range and what you can do to improve it.


Excellent Credit Score Range


Good Credit Score Range


Problem Credit Score Range


Bad Credit Score Range

Home > How Good is Your Credit Score?

Excellent Credit Score Insights

If you have excellent credit, it means you are consistently responsible with your money. You borrow and spend responsibly, make payments on time, and keep balances low on lines of credit.

Your Score Range: 800-850

Your score sits between 800 and 850 on the FICO scale, putting you in a category with only 18 percent of the population. Although you have little or no room for improvement, this score tells lenders and potential lenders that you are an excellent investment. Achieving a top score shows that you are a low risk and that lenders are very likely to receive payment on loans they grant to you.

Effects of Excellent Credit

When you ask to borrow money and you can show such a strong credit score, lenders already trust you before they get details of your loan or about your background. For this reason, you will have no difficulty finding loans when you need them, such as when you buy a car, purchase real estate or lose your job.

Such good credit also means you’ll be eligible for larger loans if you need to cover more expenses or you want to borrow to make an investment. When you do take out loans or take on other types of debt, lenders will charge you their lowest interest rates. For large debts or long-term loans, lower interest rates can mean huge savings.

For example, say you take out a mortgage of $300,000 that you aim to repay in 15 years. Your excellent credit score could make you eligible for an interest rate of 3 percent, whereas someone with a lower score might receive an interest rate of 4 percent or more for a comparable loan.

The difference is larger than it seems. Over the course of your loan, you’ll pay $72,914 in interest. Someone with the 4 percent interest rate will pay $99,431 in interest. In this example, your excellent credit score equates to more than $26,500 in savings over the life of your mortgage.

These are the perks of being diligent about paying your bills on time and being responsible in other areas of your financial life.

Maintaining Your Score

Once you achieve a high credit score, it’s important to stay on the right track financially so you can continue reaping the benefits of a top score. There are no real secrets at this point. Basically, just keep doing what you’re doing.

To keep an excellent score, continue:

  • Making payments on time.
  • Paying more than the minimum required amount.
  • Keeping balances low on revolving credit accounts.
  • Applying for new credit only when you need it.

By keeping your credit score high, you’ll continue to have access to loans at crucial stages of your life, and you’ll continue to save significant amounts of money in interest payments.

Good Credit Score Insights

If you have a good credit score, it means you are generally responsible with your finances. You tend to pay bills on time and likely keep balances low.

Your Score Range: 650-799

Your credit score sits in the range of between 650 and 799, along with those of 47 percent of Americans. While your score is not in a problem range, there is plenty of room for improvement.

Small mistakes may have prevented you from achieving a top credit score: You may have missed a few payments or accidentally overcharged your credit card, but you’ve probably avoided serious mishaps like bankruptcy in the recent past.

Effects of Good Credit

A good credit score tells lenders you are a good investment. It tells them you are relatively good at heeding your financial obligations. Most people in this category repay their loans and are therefore considered to be relatively low-risk investments.

Having good credit typically means having little trouble finding a loan when you need one. Most likely, you haven’t been turned down for a credit card, car loan or mortgage. However, when you do receive loans or open new lines of credit, your credit score makes you ineligible for lenders’ lowest interest rates.

A good credit score is not the same as an excellent score. Even a small hike in interest rates can make a big difference.

Assume you have a mortgage of $250,000, and you plan to own your house after 30 years. Your good credit score earns you an interest rate of 4 percent, whereas someone with excellent credit may receive a rate of 3 percent. During the 30-year repayment period, you’ll spend $179,674 in interest, while the person with the lower interest rate spends only $129,444. The small rate difference cost you more than $50,000.

On the other hand, you’ll pay substantially less than someone with a lower credit score requesting a comparable mortgage. In other words, your situation could be worse, but having some credit blemishes will still cost you.

Improving Your Score

When you have a good credit score, it’s important to prevent your score from slipping downward. It’s also a good idea to work toward improving your credit over time. Depending on your financial situation and exactly where you fall on the credit score spectrum, this could be a simple process or may require substantial work.

Follow these tips to improve your credit score and keep it high:

  • Request copies of your credit reports and correct any errors you find. Your score may be hurt by inaccuracies.
  • Make monthly payments on time. If you’re forgetful, set up electronic reminders.
  • Reduce your total debt amount (but do not close unused lines of credit). Do this by paying more than the minimum requirement on debts, or consider options like debt settlement and debt consolidation.
  • Don’t apply for new credit unless you need it.

Having an accurate credit report and improving your repayment habits will boost your score over time. This can make you eligible for more and better loans and improve your financial life.

» Learn More: How to Raise Your Credit Score

Problem Credit Score Insights

If you have a problem credit score, it means your credit history is noticeably damaged. It's possible you defaulted on a loan, were unable to afford monthly payments or otherwise faced financial pitfalls.

Your Score Range: 550-649

A score between 550 and 649 sits below the national average, which is around 660. Credit scores in this range are considered a problem, and they indicate that you had some significant missteps in your financial history as a consumer.

With such an iffy credit score, you have plenty of room for improvement. That said, you are far from the bottom of the credit score spectrum, which is 300.

You’ll have to work to regain the trust of creditors and lenders, and you’ll face high interest rates in the meantime. About one in five Americans falls into this problem range.

Effects of a Problem Credit Score

Most consumers with problem credit scores are considered subprime borrowers. These are borrowers considered significantly less likely to repay loans. That makes them not the ideal borrowers.

Those in the range of 550 to 599 have a 51 percent chance of defaulting on loans, while those between 600 and 649 default 31 percent of the time. Lenders therefore consider you a moderately high risk.

One of the effects of your credit score is you may have some trouble finding loans when you need them. When you do receive loans or open lines of credit such as new credit cards, you will face high interest charges. This can cost thousands of extra dollars over the course of a loan or debt. That’s why it’s important to pay off debts as soon as possible, by making more than the minimum monthly payment or by using debt reduction strategies such as negotiation or consolidation.

Improving Your Score

It’s also important to start improving your score as soon as possible, especially if you plan to apply for a large loan like a mortgage in the near future. An improved score may help you take out larger loans with lower interest rates and better repayment terms.

But remember that your score is damaged because of a pattern of financial negligence. To boost your score, you must address your problems, whether they are making late payments, defaulting on loans or taking on too much debt.

Some tips to get you back on track:

  • Request copies of your credit reports, which you can obtain free once a year. Correct any mistakes you find. Such errors can unnecessarily bring down your score.
  • Hold off on applying for new credit. Too many credit requests in a short period of time can weigh down your score. Once your score improves, you can start thinking about new lines of credit, and you’ll receive lower interest rates.
  • Be responsible with debts you already have. Pay more than the minimum required monthly payment, and be sure to make payments on time.
  • Reduce your debt balance. Reducing your overall debt can improve your credit report and credit score.

If you can’t afford to pay your creditors, it’s time to ask for help. Consider seeing a debt counselor for advice on how to proceed. Otherwise, continue responsibly paying down your debts.

Your credit score will begin to climb after several months of consistent, timely payments, and you’ll become eligible for better loans and interest rates.

Bad Credit Score Insights

If you have a bad credit score, it means your credit history is significantly damaged, likely a result of serious problems like loan defaults or bankruptcy.

Your Score Range: 300-549

Your score falls between 300 and 549, which is the lowest credit score range. About 16 percent of Americans are in this category.

It will take time to counteract your financial problems and win back the trust of creditors. However, with patience and dedication, you can improve your credit score. A higher score can grant you access to loans when you need them and help you live better.

Effects of a Bad Credit Score

Your bad credit history can affect every aspect of your life and can prevent you from reaching your personal, financial and professional goals.

Individuals in the lowest score bracket are considered to be the highest risk for lenders. Those with scores of 300 to 499 default on about 83 percent of their loans, while those between 500 and 549 default on 70 percent of them. Because of this, most lenders typically won’t extend lines of credit or loan offers to you. This could prevent you from being able to purchase a home or car.

If you do receive a loan or open a new credit card, you’ll receive subprime interest rates. In other words, you’ll be responsible for paying a lender’s highest interest rates to make up for the lender’s risk in taking you on as a borrower. For a larger loan like a mortgage, a higher rate can cost you tens of thousands of dollars by the time you finish paying off the debt.

The effects don’t stop there. Potential employers are among those who can view your credit history. Since your credit report displays a pattern of negligence, employers can choose not to hire you based on this document.

Improving Your Score

Improving your score will take time and effort. Your credit wasn’t ruined overnight, and you shouldn’t expect to fix it overnight either. Anyone who tells you otherwise is trying to scam you. But the effort you put into your financial health is worth it.

The first action you should take is to request copies of your credit reports. You can obtain a free copy of your credit report once a year from each of the three main credit bureaus. Check these over for inaccuracies that may be unnecessarily weighing down your credit score. If you find errors, notify the credit bureau to have inaccurate information removed. This is the easy part.

After that, work on consistently making good decisions going forward. While you cannot remove accurate and timely information from your credit report, you can make it less and less relevant as time goes on. Creditors give more weight to recent history than distant history, and most of your bad decisions will be erased off your report in seven to 10 years.

If you have any debts or loans, start making payments on time every month. This can begin to improve your score in just a few months. If you can, make more than the minimum monthly payment.

You may also be a good candidate for a secured credit card. This works like a credit card but is tied to your assets, meaning you could lose some property if you do not pay. Secured cards are ideal for anyone trying to establish or reestablish good credit. It is an opportunity to prove that you can handle bills and financial responsibility.

When your score improves a bit, you’ll become eligible for lines of credit that are off-limits to you now. After more consistent payments, you’ll begin to receive lower interest rates, which can save you money for years to come.

If you have bad credit, break your harmful habits and start fixing your financial history now. That way, you can begin reaping the benefits of good credit as soon as possible.

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