Bad Credit Boot Camp
An OppLoans Guide to Understanding Your Credit, Credit Report, and Credit Score.
Chapter 1. Checking Your Credit Score
A credit score is essentially a measure of your financial responsibility. Credit scores take the information from your credit report and use it to calculate a three-digit number, ranging from 300 to 850. The higher your score, the better your credit.
A credit score is a lot easier to understand and digest than digging through page after page of a long, detailed credit report showing all your most important financial transactions, payments and legal information. Your credit score sums up all of that into a neat, three-digit number, which is what most employers, landlords and lenders will look at to assess your creditworthiness.
There are a couple different ways of calculating a credit score, but the FICO score is generally considered the most reliable and has become the most popular credit score calculator in the financial industry.3
|720 to 850||680 to 850||630 to 679||550 to 629||300 to 549|
As we mentioned earlier, FICO scores range from 300-850. Scores below 549 are considered “poor”, scores from 550-629 are considered “subprime,” scores from 630-679 are considered “fair,” scores from 680-850 are considered “good,” and anything above 720 is considered “great”.
The average American has a FICO credit score of 695, which is considered “Fair” credit, and the average American household carries $16,435 in credit card debt.4
The average American has a FICO credit score of 695, and the average American carries $16,435 in credit card debt.
According to a report from major U.S. lender Sallie Mae, only 20 percent of American consumers have a credit score of above 800.6 Most lenders are willing to loan to anyone with a score of 670 or above, and some will loan to people with a score as low as 580. Scores lower than 580 are considered “subprime,” and most lenders see the 20 percent of Americans who fall into this category as high-risk borrowers, who may not be able to pay their debts.
Bad Credit Boot Camp
- What is Credit and Why Does it Matter?
- Checking Your Credit Score
- How to Build Credit When You Don’t Have Any
- How to Come Back From Bad Credit
- Building and Maintaining a (Healthy!) Relationship With Credit
- About OppLoans
- About the Experts