Reasons to Understand What Good Credit Score Range Is

Every known lender have their own standard for rating credit scores but any score that is 700 and higher on a scale of 300 to 850 is regarded as a good credit score. Most lenders use this three digit score to know your creditworthiness and your chances of getting the loan from them. The higher this good credit score is, the better your chances of getting the loan from the lender. A good credit score can also help you save on interest rates. Having a particular good credit score is not enough reason for you to get a loan or doesn’t not guarantee getting it at the lowest interest rate available, but a general understanding if where you stand with your score will help you determine the type of offer to apply for and also the areas that should be worked on before the application.

Free report can be gotten from Equifax and TransUnion. It is usually updated every week which makes it easy to track your score. Once this score is known, the next step will be to check your credit factors to get to know what is impacting them which is a very good way in helping you figure out how to improve this score. Another thing to note is the fact that several authorities refer to any score below 500 and 600 is not a good credit score which is seen as the absolute lowest score. When the score gets this low, the only lender that will give loan are those specialized in giving loan to this group of people? Down payment and collateral might not have so much impact when it has gotten to this stage. It will also be very difficult to get insurance and some employers who check good credit reports won’t give you a chance. Such score leaves an individual with very few options and it is advisable not to chance after any until it’s improved. With a low score, it is advisable to focus on reducing debt, eliminate collection accounts and make timely payments.

In most cases, there is usually a bankruptcy, active judgment, or repossession hurting you score or having several active collections. The only other possibility is that you have little to no information on report with which to build a score. Those whose account report information get stuck with low scores. For those who are newbies, it will be easier to build a good credit score than those who have accumulated negative remarks.

Summary: Almost every lender chooses their own criteria and in most cases, this score is just a factor out of others even though it is a major factor. This is due to the fact that lenders pull your scores from several sources or may decide to check through several different scoring models to know the range you fall into. Here the creditors get to decide how exactly he wants to evaluate the applicants. But with a score below 600, it would be perfect to contact a counselor and create an actionable plan to revive your good credit score.