Have you ever wondered if you have a good credit score? We all have credit scores, and each one of us has more than one such score. But how do you know if it’s good or bad? It’s simple, you just have to check the three-digit number that represents your score.
What is a credit score?
Before we talk about credit score ranges, we should make sure that everyone knows what a credit score is and what it does. Your credit score is a single number which shows your lender how trustworthy you are when it comes to borrowing money and paying back what you owe.
A high score will help you get that loan that you want so much. But, with a bad credit score, lenders will probably stay away from you.
Credit score ranges
The FICO (Fair, Isaac, and Company) Score is the most commonly used credit score in the country. It uses a range between 300 and 850. Here’s how you know if you have a bad credit score or a good one:
1. You have bad credit if you’re in the 300 – 650 range.
650 is considered the border between prime and subprime. Anything below 650 means that you’ll have a hard time getting a credit card or finding a lender willing to offer you a loan. And if you do get a loan, you’ll have to pay higher interest rates than other Americans.
2. You have fair credit if you’re in the 651 – 700 range.
In 2015, the average American’s FICO score was 695. It was an all-time high.
3. You have good credit if you’re in the 701 – 759 range.
If you’re credit score is within this range, you’ll probably get approved for whatever you want, be it a loan or a credit card.
4. You have excellent credit if your score is above 760.
If you have excellent credit, you will be greeted by easy credit approvals and the very best interest rates.