Good Credit vs Bad Credit: This Is What Your Score Should Be
Almost 80% of American workers live paycheck to paycheck. Are you one of them?
If a financial emergency popped up, what would happen? Odds are, you’d need to take out a loan to cover the expense, but could you even qualify for one? This all depends on how good your credit score is.
Unsure of how your credit score ranks? Keep reading to learn the difference of a good credit vs bad credit score.
What Is a Credit Score?
You need to understand what a credit score is before you attempt to figure out if yours is good or bad.
A credit score is a number that ranks your creditworthiness. Your score is determined by the following factors:
- 35% – payment history
- 30% – the amount owed
- 15% – length of credit history
- 10% – mix of different types of credit
- 10% – new credit
Are you wondering how many credit scores are there? If you see a few different credit scores, don’t panic. There are three main credit bureaus, Equifax, Experian, and TransUnion, and they can all provide different scores.
What’s Considered Good Credit vs Bad Credit?
What is the best credit score you can get? A perfect credit score is a score of 850, but you don’t need a score that high to be considered worthy of credit.
Excellent credit is anything above 750 while a good score ranges between 700 and 750. What is considered a fair credit score? Anything between 699 and 670 is a fair score.
On the other hand, a bad credit score is considered anything below 669. You enter the very bad range when you hit a score below 550. If you have a bad or very bad score, it can be very hard, if not impossible, to receive a loan.
Ways to Improve Your Score
Does your score fall into the bad credit score range? It’s okay, the number isn’t permanent. There are plenty of things you can do to improve your score over time.
The first thing you can do to improve your score is to review it and look for anything that is inaccurately reported. If you have a lot of inaccurate information or it looks like someone is using your identity, you’ll want the help of a credit repair company.
From there, you’ll want to concentrate on the factors discussed above that make up your credit score. Make all your payments on time and try to have a mix of credit accounts. Taking out a secured credit card and making on-time payments will help your score.
Need Help With Your Credit Score?
Now that you know what qualifies as a good credit vs bad credit score, you have a better understanding of how your score ranks.
Does your score fall into the bad credit range and you don’t want to go through the hassle of waiting for it to improve? At US Allied Financial, we provide credit repair services and do the work for you.
Get a free credit consultation and say goodbye to your bad credit score.
