It is very important to have a good credit score because the banks and financial institutions check for your score when you apply for loans. If you possess a maximum credit score, then there are more chances to get less interest rate on loans. You might wonder that – what credit score is good. The answer to what credit score is good is 700 or above. The highest credit score possible for a person is to possess is 800+. The following is a table showing you the various credit score ranges:
SCORE TYPE AND FEEDBACK
|800 and above||If you have this score then it means you have an excellent score and you are responsible in paying all the debts and bills on time.|
|750 to 799||This is a good score and you must maintain yourself in what you are doing.|
|700 to 749||This is also a good score to have but not the best but still okay.|
|650 to 699||If you possess this score then you must do better to reach 700 because that would be more better but if you go below 650 then it wouldn’t be good.|
|600 to 649||This is an okay score and it is neither good nor bad. But if you further go down then it can be worse.|
|550 to 599||This is a bad score to have and if you have this score, then you will have to speed up to get a good score.|
|Below 499||You really require help to improve your score. You need to pay all the bills on time, clear all the debts and you also need to get a secure credit card.|
The credit score is also called as the FICO (Fair Isaac Corporation) score which is a Californian company. It developed the score based on the credit report and it involved formulae to generate your score. The higher score you have, the better it is. The scores that are above 725 are considered to be a good score whereas the score that are below 600 is a poor score. A maximum credit score is one who has 800 or above. This is the highest credit score possible for a person to achieve. Even if you have a poor score, then you can regain it into a good score by doing the following things:
- Review your report: The first thing that you require to do is to get the copy of the credit report from the credit agencies. Then you have to make a thorough review on it so that there are no errors. If you find any errors, then you need to immediately report them to the specific agency or within 30 days. Once the error gets rectified, you will again get a fresh copy of your report.
- Timely bill payment: The next most essential thing to do is to pay all the bills on time. This will improve your score drastically. Once you get the bill, you need pay those 2 or 5 days before from the due date.
- Protect the credit history: The Fair Isaac Corporation believes that the people having credit for longer period of time possess less risk. Before deciding to close your account or credit cards, you need to think about it well. If you cancel your credit card or wipe out its history, then your score tends to reduce. Even if you really need to cancel the credit card, then cancel the one which is new.
Therefore the above things need to be followed in order to achieve a good score and it will be very helpful when you think of getting loans from banks or any other financiers.