Highlights:
Credit scores are calculated using information in your credit reports
Credit scores generally range from 300 to 850
Different lenders have different criteria when it comes to granting credit
It’s an age-old question we receive, and to answer it requires that we start with the basics: What is a credit score, anyway?
Generally speaking, a credit score is a three-digit number ranging from 300 to 850. Credit scores are calculated using information in your credit report, including your payment history; the amount of debt you have; and the length of your credit history.
There are many different scoring models, and some use other data in calculating credit scores. Credit scores are used by potential lenders and creditors, such as banks, credit card companies or car dealerships, as one factor when deciding whether to offer you credit, like a loan or credit card. It’s one factor among many to help them determine how likely you are to pay back money they lend.
It's important to remember that everyone's financial and credit situation is different, and there's no "magic number" that may guarantee better loan rates and terms.
Although ranges vary depending on the credit scoring model, generally credit scores from 580 to 669 are considered fair; 670 to 739 are considered good; 740 to 799 are considered very good; and 800 and up are considered excellent. Higher credit scores mean you have demonstrated responsible credit behavior in the past, which may make potential lenders and creditors more confident when evaluating a request for credit.
Lenders generally see those with credit scores 670 and up as acceptable or lower-risk borrowers. Those with credit scores from 580 to 669 are generallyseen as “subprime borrowers,” meaning they may find it more difficult to qualify for better loan terms. Those with lower scores – under 580 – generally fall into the “poor” credit range and may have difficulty getting credit or qualifying for better loan terms.
Different lenders have different criteria when it comes to granting credit, which may include information such as your income or other factors. That means the credit scores they accept may vary depending on that criteria.
Credit scores may differ between the three major credit bureaus (Equifax, Experian and TransUnion) as not all creditors and lenders report to all three. Many creditors do report to all three, but you may have an account with a creditor that only reports to one, two or none at all. In addition, there are many different scoring models available, and those scoring models may differ depending on the type of loan and lenders' preference for certain criteria.
What Factors Impact Your Credit Score?
Here are some tried and true behaviors to keep top of mind as you begin to establish – or maintain – responsible credit behaviors:
- Pay your bills on time, every time. This doesn’t just include credit cards – late or missed payments on other accounts, such as cell phones, may be reported to the credit bureaus, which may impact your credit scores. If you’re having trouble paying a bill, contact the lender immediately. Don’t skip payments, even if you’re disputing a bill.
- Pay off your debts as quickly as you can.
- Keep your credit card balance well below the limit. A higher balance compared to your credit limit mayimpact your credit score.
- Apply for credit sparingly. Applying for multiple credit accounts within a short time period may impact your credit score.
- Check your credit reports regularly. Request a free copy of your credit report and check it to make sure your personal information is correct and there is no inaccurate or incomplete account information. You’re entitled to a free copy of your credit reports every 12 months from each of the three nationwide credit bureaus by visiting www.annualcreditreport.com. By requesting a copy from one every four months, you can keep an eye on your reports year-round.Remember: checking your own credit report or credit score won'taffect your credit scores.
You can also create a myEquifax account to get six free Equifax credit reports each year. In addition, you can click “Get my free credit score” on your myEquifax dashboard to enroll in Equifax Core Credit™ for a free monthly Equifax credit report and a free monthly VantageScore® 3.0 credit score, based on Equifax data. A VantageScore is one of many types of credit scores.
If you find information you believe is inaccurate or incomplete, contact the lender or creditor. You can also file a dispute with the credit bureau that furnished the report. At Equifax, you can create a myEquifax account to file a dispute. Visit our dispute page to learn other ways you can submit a dispute.
FAQs
For a score with a range between 300 and 850, a credit score of 700 or above is generally considered good. A score of 800 or above on the same range is considered to be excellent. Most consumers have credit scores that fall between 600 and 750. In 2023, the average FICO® Score☉ in the U.S. reached 715.
What is a good enough credit score? ›
For a score with a range between 300 and 850, a credit score of 700 or above is generally considered good. A score of 800 or above on the same range is considered to be excellent. Most consumers have credit scores that fall between 600 and 750. In 2023, the average FICO® Score☉ in the U.S. reached 715.
What does a good credit score say about you? ›
“A high credit score means that you will most likely qualify for the lowest interest rates and fees for new loans and lines of credit,” McClary says. And if you're applying for a mortgage, you could save upwards of 1% in interest.
Is 780 a good credit score? ›
A 780 credit score is Very Good, but it can be even better. If you can elevate your score into the Exceptional range (800-850), you could become eligible for the very best lending terms, including the lowest interest rates and fees, and the most enticing credit-card rewards programs.
Is 750 a good enough credit score? ›
A 750 credit score is often considered very good — or even excellent. A very good or excellent credit score can mean you're more likely to be approved for good offers and rates when it comes to mortgages, auto loans and credit cards with rewards and other perks.
Can I buy a house with a 780 credit score? ›
Conventional lenders now require a 780 credit score or higher to qualify for the lowest mortgage interest rates, so anything above 780 is considered an excellent score to buy a house.
What is a good credit score by age? ›
How Credit Scores Breakdown by Generation
| Average FICO 8 Score by Generation |
|---|
| Generation | 2022 | 2023 |
|---|
| Generation Z (ages 18-26) | 679 - Good | 680 - Good |
| Millennials (27-42) | 687 - Good | 690 - Good |
| Generation X (43-58) | 707 - Good | 709 - Good |
2 more rowsThe minimum credit score needed for most mortgages is typically around 620. However, government-backed mortgages like Federal Housing Administration (FHA) loans typically have lower credit requirements than conventional fixed-rate loans and adjustable-rate mortgages (ARMs).
What is a good credit score to buy a car? ›
Your credit score is a major factor in whether you'll be approved for a car loan. Some lenders use specialized credit scores, such as a FICO Auto Score. In general, you'll need at least prime credit, meaning a credit score of 661 or up, to get a loan at a good interest rate.
What credit score do you need to get a $30,000 loan? ›
Requirements to receive a personal loan
This allows them to look at your history from the past seven years and see whether you've typically made payments on time. For a $30,000 loan, you'll typically need a credit score above 600 just to qualify or above 700 to get a competitive rate.
Highlights: While older models of credit scores used to go as high as 900, you can no longer achieve a 900 credit score. The highest score you can receive today is 850. Anything above 800 is considered an excellent credit score.
How rare is a 720 credit score? ›
Who Has a 720 Credit Score?
| Credit Score | Tier | Percentage of Americans |
|---|
| 720 – 850 | Excellent | 38.12% |
| 660 – 719 | Good | 17.33% |
| 620 – 659 | Fair/Limited | 13.47% |
| 300 – 619 | Bad | 31.08% |
What is the average credit score? The average FICO credit score in the US is 717, according to the latest FICO data. The average VantageScore is 701 as of January 2024. Credit scores, which are like a grade for your borrowing history, fall in the range of 300 to 850.
Can I buy a house with a 723 credit score? ›
However, with a 723 credit score, you should qualify for rates on-par with national averages. Also, even though your score qualifies you for a mortgage, it's important to know that the lower your score is, the stronger the rest of your qualifications are generally expected to be.
Can I buy a house with a 770 credit score? ›
Mortgage lenders typically want to see a score of 620 or better before approving a conventional mortgage. There are government-insured mortgages if your score is lower, and if your score is 760 or higher you'll qualify for the best interest rates.
Can I buy a house with a 750 credit score? ›
With a 750 credit score, you're in the running for pretty much every kind of home loan. FHA loans, VA loans and USDA loans all have much lower minimum credit score requirements, and conventional loans have a minimum credit score requirement of 620.
Is 600 a good or bad credit score? ›
Your score falls within the range of scores, from 580 to 669, considered Fair. A 600 FICO® Score is below the average credit score. Some lenders see consumers with scores in the Fair range as having unfavorable credit, and may decline their credit applications.
Can I buy a house with a 643 credit score? ›
Can I get a mortgage with an 643 credit score? Yes, your 643 credit score can qualify you for a mortgage. And you have a couple of main options. With a credit score of 580 or higher, you can qualify for an FHA loan to buy a home with a down payment of just 3.5%.
What percentage of population has over 800 credit score? ›
How rare is an 800 credit score? An 800 credit score is not as rare as most people think, considering that roughly 23% of adults have a credit score in the 800-850 range, according to data from FICO. A score in this range allows consumers to access the best credit card offers and loans with the most favorable terms.
What should be your minimum credit score? ›
A CIBIL score of 750 or above in your credit report is ideal. It will aid in qualifying you for personal loans and credit cards. However, if your CIBIL score is below 685, you will find it harder to borrow funds from banks and NBFCs.
