What Credit Score is Good?
January 15th, 2009, Written By: admin
What is a good credit score? That largely depends on the lender’s standards, but there are some general guidelines to follow. You should use the FICO score as the standard metric for determining how good your credit is, because that is the model most major lenders use.
The FICO score ranges up to 850 points, which is perfect credit. You can’t get higher than a 850 score and very few people have a score that high. In fact, if you’re goal is to have good credit, an 850 score is not very realistic – nor is it necessary.
Today, after the credit crisis in America, what is considered good credit has changed. In the past, a 720 was considered good credit and would reward you with the best rates and terms on a loan. Today, however, that standards has raised to about a 760 score.
Once you have a 760, you should have no problem qualifying for the best possible rates and what is considered “preferred credit.”
If your score dips below 700, there is room for improvement. a score in the high 600′s will still be able to get loans and credit, but most likely not at the best rates. Depending what is causing your score to be less than great, it shouldn’t be too difficult to incrase your rating before applying for a car loan or mortgage.
Those who have a credit score below 650 will have difficulty getting the financing they need, as you may be classified as high-risk. If you can secure financing, it will be a high-risk rates, which means you’ll be paying a lot more money for your purchases than those with better ratings – as much as 6x more money over the life of the loan.
Finally, those who have bankruptcies, foreclosures, judgments and other big financial strikes on their credit report will not be able to get financing on their own. But with a little work, that can be changed around rather quickly.
So what credit score is a good one? Your goal should be to hit 760 and keep it there.
Get Your Credit Score Free
Categories: Credit Score Information
