Credit score ranges vary depending on the credit scoring model used (FICO vs. VantageScore) and the credit bureaus that extract the score (Experian, Equifax, and TransUnion). While such score ranges are for educational purposes, lenders end up setting their own standards for what they consider a good credit score. Ultimately, the lender will determine the score needed to get the best interest rate, but generally speaking, the highest credit score usually means the lowest interest rate.
Approved
Getting a good score doesn't necessarily mean you'll be approved for a loan or that you'll get the lowest interest rate, as there are other factors that lenders take into account. Every time your FICO score is in a better range (as determined by individual lenders), you have the potential to get better financing offers. With a good FICO score, you're more likely to get loans, credit cards, new apartment rentals, and more. A good or excellent credit score can help you get lower interest rates and better terms if the lender approves your loan application.
Bad score
Having a bad credit score will give you more choice of credit cards, easier time to get approved for various loans, and much lower interest rates on such loans. A FICO score between 740 and 850 is generally considered to be in the range of very good to excellent credit score for buying a home. As is the case with borrowers with excellent credit histories, borrowers rated "very good" by their FICO score will have a solid history of timely payments on various credit accounts. People with this score have a long history of no late payments, as well as low credit card balances.
FICO
A higher number equates to greater creditworthiness, so a person with a FICO score of 850 is almost guaranteed to pay off their debts, while a person with a 300 score is thought to be more likely to miss payments. The FICO system reports scores ranging from 301 to 850, with higher scores indicating higher credit. Most credit scores range from 301 to 850, with lenders preferring higher scores when considering consumer loan applications. A good credit score mainly depends on the model you use, the FICO model has a range of 300 to 850.
VantageScore
Ideally, with the FICO model, you would like to get at least 700 points. For VantageScore 3.0, a score of 661 or higher is good, and a score between 781 and 850 is excellent.
Although VantageScore usually has the same range, they define "good" differently. Although VantageScore uses the same 300-850 range, they have different ratings. Both FICO and VantageScore range from 300 to 850, although they each analyze their scores differently in different rankings. The Big Three Credit Bureaus Experian, TransUnion and Equifax Experian TransUnion Equifax's FICO and VantageScore (scores developed by the Big Three credit bureaus Experian, TransUnion and Equifax) are both between 300 and 850.
Fair or Good As shown above, FICO and VantageScore consider "fair" or "good" credit slightly different: FICO uses a score of 670-739 to describe good credit, while VantageScore uses 661-780 to describe the same category. On the other hand, a FICO(r) score below 670 is in the fair to poor range, while a VantageScore 3.0 score below 660 is considered fair, poor or very poor. FICO scores are divided into five different ranges, from "very poor" to "abnormal," so you can quickly assess your credit profile by seeing where your score falls.
Credit bureaus
The FICO score is a well-known measure developed by the Fair Isaac Corporation and used by credit bureaus to determine a borrower's risk. The term "credit score" most often refers to the FICO score, a number between 300 and 850 that represents a person's creditworthiness - the likelihood that, if they were given a loan, they would be able to repay it.
Formula based
It is calculated using a formula based on five variables: payment history, debt amounts, length of credit history, credit balance and new credit. Your credit score can affect the interest rate you pay to a lender and even make a difference between approved and rejected loans. In addition to eligibility for a credit card, your score can also have a significant impact on your APR and other terms and conditions of your account.
In fact, this number has such an impact on various financial aspects of life that it can determine your eligibility for approval of credit cards, auto loans, mortgages, rent, and even certain jobs. This number can affect your ability to live the lifestyle you want and determine how much you'll pay for things over time, so it's a good idea to know your credit score, which typically ranges from 300 to 850.
Mortgage
You won't be eligible for the best mortgage rates or 0% off credit card deals yet, but a score above 670 gives you access to a modest array of financing options. However, if your score falls below this level, you may still be eligible for some financial market mortgage lending opportunities. When it comes to getting a mortgage, a credit score that falls within the generally accepted Good, Very Good, and Outstanding ranges almost always opens doors for you when it comes to eligibility and attractive rates. If your credit score is solid (most lenders consider a FICO(r) score of 740 or higher to be excellent), you will generally be able to qualify for a regular loan with a low down payment requirement and a low interest rate.
Easily
People with scores in this range can often easily get credit card approval and get the most attractive loans with the lowest interest rates and fees. In fact, scores in this range are often considered average at best and unlikely to win you the best loan rate. Even if you're near the top of the range, a higher score is always better.
