What is a good credit score?

As per Fair Isaac Corporation that is more popularly known as FICO, on a scale of 300-850, the average credit score in the United States is 723. The majority of creditors implement the FICO model as the principal credit scoring model.

The majority of people have their credit scores in the range of 600-700. Higher FICO scores are preferred by the lenders. They access your FICO score from three credit bureaus; Experian, Equifax and TransUnion.

Usually, a FICO score of more than 700 is regarded as a very good credit score by several lenders. Nevertheless, the opinion may vary from lender to lender.

What is a good credit score according to FICO?

Following is the breakdown or analysis of credit scores according to FICO:

700 and higher: This is regarded as very good to excellent. The lenders would not hesitate to offer you a loan when you have a credit score of 700 or more

680-699: This score is considered to be falling in the good category. The lenders usually do not see much difference between very good to excellent and good, so you don't need to worry about that.

620-679: When your credit score is falling under this range, this is regarded as "ok" category. The nearer your score is to 679, the fairer it is for you. 620 is conceived as "at par"credit rating and it might be necessary for you to furnish substantiating details. These include professional and personal references, statements for additional income, and records authenticating the time span of your present job.

580-619: Though you are not falling into the "bad" category, if your credit score comes under this range, you are reeling on the edge. The prime rate limit or cut-off is 620, so make preparations to pay an elevated interest rate.

500-580: You are able to receive credit if you fall within this range, however you might have to pay a substantially high rate of interest. You should also go through the terms and conditions of your loan contract very carefully. Try to understand how calculation of your interest rate is done in an attentive manner. A few predatory lenders would demand interest rates on automobile loans which are estimated similar to credit cards on the basis of a daily average balance. If you come across this stuff in the disclosure documents of an automobile loan, you should just leave by putting your pen down.

499 and less: This is a really bad credit score. You can avail credit with such a low score, yet the interest rates would literally make your life miserable. You should take one year or two years as time to repay all your bad debts, better your credit and apply again at a future date.