Maintaining a good credit score is important as it is a powerful tool when it comes to loan approval or credit card approval. Some credit scoring is different in different models but in nutshell, higher score is always better to stand out. In general credit score falls under below ranges:
|300 to 550||Poor||You may have very little chance of securing new credit. You need to take steps to repair your credit score.|
|550 to 650||Fair||You can still get a credit, but be prepared to pay higher interest rates.|
|650 to 750||Good||This is the sign of a financially responsible consumer. With this score, one can be eligible for loan and credit card at good rates.|
|750 to 850||Very Good||You can be eligible for competitive rate, if not the best rates when you borrow.|
|Above 850||Excellent||You are on top priority for lenders and you can get best rates.|
Higher credit score represents that you have mindfully utilized your available credit and have not missed out on any payments hence, you will always be considered as the first priority by the lenders. But vice versa, lower credit score describes you as credit riskyand it maybelikely that you get rejected for loan or credit card; or in case if you get approved then you would be charged a higher rate than usual, or be given an amount smaller than what you applied for.
Concluding this, one must always have eyes on one’s credit score and, one must understand the risk associated with the number of one’s credit score.