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What are Credit Score Ranges and how do they Affect You?

by Mark Sander5 min read
What are Credit Score Ranges and how do they Affect You?

We hear a lot of terms like “credit score” and “ credit score ranges ” when we talk about credit cards. What do they mean? Why do they matter? How are these numbers arrived at? Here is a brief summary of all these questions.


What is a credit score?

This is a number that is calculated using a formula that includes variables like the number of credit card accounts you own, your payment history and the amount you owe.


Do I have only one credit score?

No.You do not just have one single cohesive credit score. This is because your credit scores are calculated using information taken from your credit report, which you can get from any one of the three main credit bureaus in the US – Experian, Transunion and Equifax. Since each bureau may have different information about you, your credit scores could differ. 

Another reason is that credit scores can be calculated using different measures (FICO, Vantage Scores or even measures some lenders create in-house). Additionally, scoring models can also be tweaked depending on what it is being used for. So, your scores may be different when you apply for an auto loan versus when you apply for a credit card or a mortgage and so on.


Why is a credit score important?

Your credit score represents the risk a lender is going to take by lending your money. The lower the score, the higher the risk for the lender. There are different measures in which a credit score is arrived at, however, the most common one that is used by almost all lenders is the FICO score. Another score in use is called Vantage Score  which was created by the three national credit reporting agencies – Experian, Equifax and Transunion.

FICO scores have range of 300 to 850 and Vantage scores have a range of 501 to 990.


What are credit score ranges and what do they mean?

For this article, we will only refer to the FICO credit scores ranges as they are the ones that are most used. Here is a more detailed description of the various credit score ranges:

  • Excellent Credit Score: 720 – 850

People with excellent credit scores are considered very responsible borrowers and qualify for the lowest interest rates. Characteristics of a person with excellent credit score include:

  • No late payments – on any bill – ever
  • Low credit card balances


  • Good Credit Score: 690 – 720

A person with a good credit score is considered a responsible borrower and are offered lower – but not the lowest – interest rates. Characteristics of a person with good credit scores include:

  • On-time payment of most bills
  • Maintaining a relatively low balance on their credit cards in relation to their credit limit amounts


  • Problem Credit Score: 650 – 690

Those with a problem credit score have a damaged credit history. They pose a high risk of defaulting on their payments and tend to get charged very high interest rates. The person can be turned down when applying for credit.

Characteristics of people with problem credit scores include:

  • Had money problems in the past (maybe even a loan default)
  • Having more than one lender
  • A tendency of not paying bills, being late or not making full payments


  • Poor Credit Score: 350 – 650

This is the worst of all credit score ranges and it implies that a person’s credit is severely damaged. Chances of being given any form of credit are nil. Damage to the credit score could be due to multiple defaults and/or bankruptcy.

If a person is in this credit score range, then he or she needs to talk to a Credit Counsellor.


  • No Credit: 0 – 349

A person with no credit means that either a person has no credit history since he has never taken out a loan and doesn’t own any credit cards, or that the person has such a bad credit history that it will take a lot to repair it.

Try to remain in the upper credit score ranges since you will save a lot of money in interest and finance charges.


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