What is a Good Credit Score? And More Credit Questions You Might Have

Anyone who has attempted to get a loan, credit card, or mortgage will know how important having a good credit score is to their chances of a successful application.

Your credit score is one of the essential considerations lenders make when deciding whether or not to offer a loan.

Credit scores are one of the factors credit card companies and lenders consider not only whether to loan the money but decide the loan amounts and interest rate.

Credit Score Ranges

A credit score measures a person’s propensity to repay debt, ranging from 300 to 850, and is a numerical rating.

A borrower with a higher credit score is considered less risky, more financially responsible, and more likely to pay back the credit.

What is the Average Credit Score and What is a Good Credit Score?

The average VantageScore is 688, while the average FICO score is 711. Generally, a credit score of 680 or higher is considered good, and a score of 740 or above is considered exceptional.

Different Types of Credit Scores

1. Bad Credit Score Range

Lenders reject credit applications with credit scores below 550. A bad credit score ranges between 300 and 549. If the score is in this area, the borrower needs to put some effort into improving it.