What Is a Favorable Credit Score?
Consumers who use credit cards or have a mortgage also have a credit score. The score is generated by a formula used by credit reporting agencies and is based on your income, debt and payment history.
Other People Are Reading
-
Low Scores
-
Credit scores can range from 300 to 850. A score of 300 to 679 is considered subpar. While some lenders may approve credit for consumers at the higher end of the range, interest rates may be high.
Good Scores
-
According to Fair Isaac Corp., lenders use credit scores billions of times a year to make decisions about whether or not to offer a consumer a loan. Consumers with a good credit score of 680 to 719 will likely be approved for credit.
-
Excellent Scores
-
If your score is above 720 you will not have trouble securing a loan and will receive the best available interest rates.
Benefits
-
The higher your credit score, the better chance you have of being approved for credit cards with low interest rates. You will be able to secure a mortgage or loan with better terms than those with low scores as well.
Improving Your Score
-
To improve your credit score, only use a small portion of your credit line, pay your bills on time, and check your reports for errors frequently.
-
References
Resources
- Photo Credit Image by Flickr.com, courtesy of Andres Rueda
