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Debt Counseling Assistance :: What Is Considered a Good Credit Score
What Is Considered a Good Credit Score:
Understanding What Is and What it Takes to Get a Good Credit Score
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The first step to understanding your credit is to know just what is considered a good credit score. Most "good" scores will start at about 680, meaning if your score is higher than this than you will most likely qualify for the credit that you want.
Borrowers below that number and in the low 600's are often referred to as "sub prime" borrowers. If you're in this position, you'll likely want to upgrade your credit history.
The good news is you don't need to despair if you're shy of that magical 680. Increasing your credit score by even just 5 points can save you money. For example, if you have a credit score of 697 and you improve it to 702, you can save thousands in interest rate fees.
But, how do you improve that score and earn those extra five points? What is considered a good credit score improvement? Keep reading to find out.
Have a Good Debt to Credit Ratio
By evenly distributing your credit card debt, you can improve your debt to credit ratio. For example, if you have three credit cards and one is maxed to the limit, while the other two have a zero balance, you're better off distributing that debt. Ideally, you want your credit card debt on each card to stay below 30% of your available limit.
Keep Credit Score Inquiries to a Minimum
Every inquiry into your past and credit history will impact your credit score anywhere from 2 to 50 points. The good news is, for major loans like mortgages and auto loans, the credit reporting companies consider that you'll likely be shopping for a loan and count multiple inquiries in a 14-day period as one, single inquiry. To avoid an expensive mistake, keep your loan shopping within this time frame.
Try a Credit Repair Company
A credit repair company will try to tell you what is considered a good credit score and how to achieve it. They may promise the world, but, like any business, they may not deliver. Before you invest in credit repair services, check with the Federal Trade Commission to make sure you're dealing with a reputable and recommended credit repair firm.
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