Credit Score Scale… Everything You Need To Know About It
In today’s credit based economy, few figures matter more than the credit score scale of a person when it comes to deciding the fate of his or her loan application.
In order to understand what score is considered good by a bank or a financial organization and what is considered bad, you need to learn about credit score scale and know what a particular score range implies.
The FICO score is essentially a three-digit score in the numerical range of 300 and 850 with 300 being the lowest score that a person can get and 850 being the highest score that is hardly attainable.
You’ll Want a Credit Score Scale Result That Inspires Confidence in Lenders
Beginning from the upper end of the credit score scale, a rating between 760 and 849 denotes excellent creditworthiness and implies that the person has a near-perfect payment history.
This inspires great confidence in lenders and they offer quick approvals for loan applications submitted by such individuals.
People with a credit score within this range not only get fastest approvals but lowest interest rates as well. A FICO score between 700 and 759 is also considered great and gets fast loan approvals and low interest rates from various lending institutions.
The Preferred Range
If your score falls in any of the above two ranges, you can be rest assured about your finances. In fact, the next range of credit score between 660 and 669 is also regarded as a good score and ensures relative ease in getting a line of credit.
Most Americans who have a steady job fall in this credit score scale and even though they may not be able to fetch the lowest possible interest rates for their loan, they face no problem in getting their loans approved.
Anything below this range connotes a level a risk attached to the person and makes the lender dig up the payment history of the applicant to judge his or her level of creditworthiness.
The Not So Preferred Range
While a score between 620 and 659 is still considered fair, anything below it falls in the category of poor rating on the credit score scale. If your FICO score is below 619, you need to focus on repairing the same so that you do not have to run from pillar to post to get a loan in times of monetary crisis.
Moreover, even if you manage to get a loan, it will come with an exorbitant interest rate that may ensnare you in a debt trap if your credit score scale is not right.
Learn more about credit score scales at about.com
