What is a Good Credit Score?

Knowing what your credit score is won’t do you a lot of good if you don’t know what those numbers mean. A good credit score can open many great financial doors for you; when you have a topnotch credit score, you will enjoy lower interest rates and will be approved for loans and lines of credit a lot more easily. All too often, people find out what their credit scores are but don’t dig deep enough to find out if they’re any good. Below, we’ll take a look at what makes a good credit score.

Poor Credit Scores

In order to tell a good credit score from a bad one, it helps to know what constitutes a low score. Most financial experts agree that any score below 600 isn’t very good. When your score drops below 600, any credit that you will qualify for will come with very high interest rates and restrictive limits. If you’re able to get a credit card with such a low score, it will probably have a high annual fee; you may have to put down a deposit to secure the credit card, too. If your credit score is below 600, you do not have a good credit score.

So-So Credit Scores

Credit scores that are between 600 and 700 fall squarely in the “so-so” range. Most mortgage companies won’t take you seriously if your score is below 650 or 660, so if you’re going to be shopping for a home loan you should build your score up to at least that level. While scores between 600 and 700 aren’t spectacular, they are generally high enough to qualify you for a decent array of options. Remember, though, that you’ll be paying a lot more than people with higher credit scores do.

Great Credit Scores

Great credit scores begin in the 700-and-above range. Once your score hits about 720 or so, you should be able to qualify for extremely competitive interest rates and other perks. There isn’t a lot of difference between a score of 720 and 780; lower interest rates, of course, but they’re all pretty good in this range. People with credit scores above 770 or so have long, clean credit histories and have demonstrated a consistent ability to repay their loans and other financial obligations on time. Even if your score is below 700 right now, you can get it into this coveted range by being careful with your money.

The Bottom Line on Good Credit Scores

If your credit score is anywhere below 600, it is considered extremely sub-prime; if it’s between 600 and 700, it’s getting closer to being considered a good credit score. The main line to strive for, though, is the 700 mark. Once you’ve surpassed that point, you can confidently say that you have a good credit score – and lenders will agree. In turn, you will enjoy benefits like low interest rates and great repayment terms. Good credit can make your life a lot easier, so pump up that score today!