By Rochelle N Belnap, The Arizona Credit Law Group, PLLC
These days everyone needs credit and your credit directly impacts your pocketbook. Bad credit or no credit will cause you to pay higher deposits for utilities like gas, water, and even cell phones. It will also increase your insurance rates, and can hurt your ability to get a job, or a promotion, or even an apartment. Credit matters, a lot.
However, with access to free credit monitoring services like www.creditkarma.com you can see what information is on your credit report and even your credit scores for 2 out of the 3 credit bureaus. This is great! But, what does it mean to you?
If you have bad credit or just not so good credit, the first hurdle you want to overcome is a 580 credit score. With a 580 FICO you will be approved for some types of financing but you will pay higher rates and the terms just aren’t that great. For instance, you can probably get a car loan, but at 18%.
The next level is a 640 which is the magic number for qualifying for most types of financing on good terms for mortgages, cars, credit cards, etc. A 640 is considered pretty decent credit.
If you already have a 640, aim for a 680 FICO. If you own a business you will need a 680 to qualify for unsecured business financing, and as an individual you will receive increased credit limits on credit cards you already use, and you will get better rates on cars and mortgages.
After 680 is the coveted 720 FICO. With this score you are rarely denied any type of financing, deposits are waived, and 0% APR is a common occurrence. After this you are looking at 750+ and then you are in great shape. Everything above a 750 FICO and you are just bragging. The scores go up to 850 but no one has a perfect score, but anything above 750 and people will say things like “wow, you have really great credit.”
That’s it. This is your guide to credit scores. Good luck and get improving if needed. As always, if you have questions you know who to ask.
Thanks for reading!