Your Credit Score is 3 digit numbers, a representation of your credit repayment handling ability. A Credit Score is calculated with a formula based on five factors – payment history, amount owned, length of credit history, credit mix and new credit.
Apoorvaa is going to tell you the different credit score ranges in brief.
Excellent Credit Score 750-900 – Borrowers whose credit score falls under this range indicates that the borrower is highly responsible in repaying. Any lender or bank would love to extend credit to them with lower interest rates and even have best credit card offerings for them. They have zero or no pending or due or late payment history and are considered lowest risk when lenders or banks lend them.
Good Credit Score 650-750 – Borrowers whose credit score falls under this range indicates good financial responsibility but they might have missed one or two payments. However, generally they are on time in repaying their loan or credit card bills. They also maintain optimum credit utilization for their credit card. These borrowers will get a loan easily but might have to accept it with a higher interest rate and are also considered low risk when lenders or banks lend them.
Average Credit Score 550-650 – If your credit score falls under this credit score, then you have an average credit score. This indicates that you need to work on your credit files to improve your credit score. You can implement some of the best practices to improve it like paying credit card bills on time, keeping the right credit mix and avoiding closing old accounts for a longer credit history. They are also considered high risk when lenders or banks lend them.
Poor Credit Score 300-550 – This credit score indicates that a borrower might have missed several repayments, default on credit accounts. In need of credit, the chances of facing rejection are high and if given credit, then you have to settle for a very high interest rate. They are also considered the highest risk when lenders or banks lend them.
Your credit score is based on a variety of factors and can be used to determine whether you will qualify to borrow money or not. So it is important that you always check your credit score.
Menu
