Understanding the credit score scale may greatly improve your chance of being financed for something in your future. Many people do not realize how important credit really is in life, but it could affect the house you get, the car you qualify for, the interest rates you pay, and a multitude of other situations you may be unaware of. Your credit score marks how reliable you are to make a payment when you finance something. Many factors go into figuring this score, but the number that comes out will be scrutinized by lenders any time you apply for financing. The right score can yield great rewards, just as bad scores can lead to disappointments.
Credit Score Numbers
What is the credit score scale? It is the set of numbers your credit score can fall into. If you look at a credit score scale chart, you can see just where you stand with lenders. There are different ranges within this large scale that depict what kind of credit you have and how easily you can be financed. Here is a look at a few of them:
Less than 600: This is the lowest level credit score you can have, and it will be quite difficult to secure financing if your credit is this low. The lowest score on most scales is 350, and that reflects a person with a history of missed payments and repossessions.
600-640: This is the “poor” range of the credit score scale good to bad, and it will provide you with some options for financing. One thing you will need to worry about in this range is high interest rates.
641-680: This is the “fair” range for your credit to fall into. It is the range that lenders like to loan money out to. You can get better interest rates in this range than you can in the poor or bad ones, and you should be able to be financed in most cases.
681-720: This is the “good” range of credit and one that you certainly want to aim for in your life. Most people in this range have little trouble obtaining the loans they need, and there is a chance for low interest rates here.
Above 720: This is deemed to be “excellent” credit and is the highest level of credit you can get. The top of this range hits 850 on most scales, reflecting a person with extensive lines of credit with years of timely payments made on them.
Improving Your Credit
You can improve your credit score by consistently making payments on your loans and credit cards. If you have no credit at all, get a small credit card or auto loan to start with and make consistent payments on it. The longer you have a single line of credit, the better off you will be. Look at sites like www.IdentityGuard.com to get a copy of your credit report, and monitor what is on there at all times. Only you can control where you lie on the credit score scale.
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