Now A Score Above 800 Is Considered Excellent

Category: Finance, Credit.

We all know that our credit score is pretty much the key to credit success. This is also the number that could keep you from that dream job or house.

This is the three- digit number that helps banks and credit unions know if you can be trusted with loaned money. Your score is determined by your credit history. On the other hand, when you miss a payment, the same action takes place. When you pay your bills and loan payments on time, it is recorded in your credit report which leads to your credit score. Your credit score could increase or decrease substantially because of one financial decision you make. How can you tell when your credit score crosses the line from bad to worse? So how do you know when your credit score is good enough for that mortgage loan you would like?

We all wish there was a chart that comes with your credit score saying" if you have this number, you are fine. " But it doesn t work that way at all. Some banks have a minimum credit score to even become approved for a loan, no matter how much your monthly income proves to be. Every bank, and financial institution, credit union has their own standards and charts for what is a good, bad or excellent credit score. This number can either help you strive or fail when applying for a loan. In this case, the median score of 525 is not good at all. The scale ranges from 300, being the lowest score, being the highest, up to 850 possible score. This number of score would be considered poor and you probably wouldn t be approved for any type of loan.

Those with this high of a score get the best interest rates and know how to pay their bills off in due time. Now a score above 800 is considered excellent. Those scores above 700 are considered good and usually are approved for loans. This is a hard task to accomplish because it takes a lot of time, but it can be done. The average American has a credit score of 72If you have a score that is below average and keeping you from that car or mortgage loan, make a plan to increase it. The best way to improve your credit score is to pay all of your bills in full and on time.

Don t become discouraged if your lender thinks your score is too low for a loan. Make a repayment plan for any debt that you might have and stick to it. Look to other lenders as their standards vary. Use a solution like this to help build your credit score. There are also loans and credit cards available for those with damaged credit scores. You will see results in just a few months if you take action with your credit score.

If you are just building your credit, remember that this is a very important time for your future financial success.