What's so important about a credit score? Why bother knowing your score and why try to increase it? These are questions that may be asked by people who don't know the importance of credit score.
Many banks and brokers are now generous enough that they will approve every credit or loan application that an individual files as long as his credit score is high.
Another question is "How high is high and how low is low in terms of a credit score?" This dilemma is answered because there are established credit score ranges. This range will tell and efficiently assess if your application for loan must be accepted. Below is the credit score range from higher to lower score.
Credit Score 800-850+
If your credit score falls within this range then you should be happy. If you apply for loans, surely your application will be accepted and you will be offered with great discounts.
There are also credit scores higher than 800 that banks would not be impressed with if the score was acquired just after you have established the account and you still have no credit history. But with 800 and above credit score and with a supporting credit history, all terms will be in favor of you.
Credit Score 720-799
With this credit score at hand, you will still be offered with the same discounts and rates with credit score 800 above but the only difference is you will receive lesser price incentives. Your credit account will also be checked thoroughly. But there is nothing to worry about this credit score since it still falls under the category excellent.
Credit Score 680-719
If the credit score ranges from 680 to 719, it will still be deemed as a good credit. But the interest rate would be higher compared to those who have excellent credit score. The capability to loan will also be limited to specific types of financing. You are not allowed to have an A-paper mortgage loan or avail the lowest ref="/Auto Insurance">auto insurance premium.
Credit Score 620-679
This range is still believed as good credit but you will have many limitations and there are cases in which your application will be rejected. Your credit can be approved but you'll have the highest interest rate and poor discounts.
Credit Score 580-619
This is the turning point credit score range in which your "ok" credit turns to bad. You will have difficulties getting your loan and applying for a credit card. You need to deal with the highest interest rate and need to take action to increase your credit score.
Credit Score 500-579
You need to immediately repair your credit account. Try to evaluate your credit history. Your credit application will be rarely accepted. If so, the highest interest rate is the terms.
Credit Score below 500
Having these credit score ranges are the worst score an individual could have. You need to learn how to increase your credit score immediately. If you try to apply for another loan, it will be undoubtedly rejected.