Recently, as you know, our financial world has been turned upside down. Financing isn't as easy to obtain now days. As a result it is best to have the strongest possible credit scores if you need to obtain financing. Now many people are wondering, are my credit scores good enough? What is a good credit score?
A quick search on google yielded some interesting results. According to Experian, the average credit score in America is a 736. A 736 credit score seems very high. It's no surprise if that sounds a little odd to you. In fact, Experian is talking about a credit score called the Vantage Credit Score which banks, lenders and creditors do not use. It is important not to be fooled into learning about credit scoring systems like Vantage Score, Plus Scores or anything non-FICO.
In fact, FICO scores are the scores that most banks, lenders and creditors use. If a mortgage credit report is pulled, there will be three credit scores generated, all of them are FICO scores. The FICO scoring system enjoys a near complete monopoly on credit scoring.
So let's rephrase our question. What is a Good FICO Score?
740+ FICO Scores The feedback that I get from lenders is that with a 740 FICO Score, you can pretty much get approved for any type of financing that you want (of course assuming you meet their other requirements). A 740 credit score might be needed to obtain business financing, unsecured personal loans, vacation rentals and second homes. A 740 isn't a good credit score, it is an excellent credit score.
720 FICO Scores A 720 FICO Score has always been the benchmark for A Paper credit. With a 720 credit score, you will get approved for most of the different types of loans out there. Buying a car with a 720 credit score should be a breeze. A 720 is a great credit score.
680-719 FICO Scores You still have many options with a 680 credit score. USDA will lend to you with a 680 credit score. You should still be able to buy a house or car with little to no problems. It seem like a 680 credit score is at the low end of what is now considered a good credit score.
660-679 FICO Scores In this credit score range you are met with limited options. Lenders, banks and creditors will be reluctant to give you financing. Your interest rates and financing charges will be higher than they could be. You can still get a car or mortgage with this credit score but let's face it, if you had better credit score, you would get a better loan.
620-659 FICO Scores Your scores are weak and they can easily be improved upon if you only had more knowledge of how the credit scoring system works. Pay your accounts current and reduce your revolving balances and you might improve into the next category. You can still buy a house with a 620+ credit score through the FHA Home Loan program. Ask you banker about an FHA loan. You are limited by your credit score in many ways.
Less than a 620 FICO Score If your score is less than a 620 the option that you have left are bad options. Anybody that actually gives you a loan will charge you a very high rate unless you were in the military in which case you might be able to get a VA loan. The good new is that it is very easy to obtain a 620 FICO Score. I help people increase their scores past a 620 all the time. A 620 FICO score is a very achievable goal for anybody. It's the 680+ credit scores that are more difficult to get. The best thing to do is to allow a professional to review your credit report and I'm not talking about the guy at the bank. Your banker and mortgage guy hopefully have a general idea how credit scores work but more often than not, they give terrible advice because they are out of their scope.
Asking for FICO score advice from your banker is like asking for directions from someone who doesn't drive. Good chance you're not going to arrive at your destination anytime soon.
If you want to know how to achieve your FICO Score goals FAST, call the experts at EZ Credit Repair (702) 487-3398 or (Click Here).