Credit Score Scale Chart

Let's face it, most Americans live on credit! Although, some of them manage to sail smoothly by paying more than their monthly payment amount, rest barely manage to meet the minimum amount. Naturally, such people resort to taking loans at lower interests, to reduce their financial burden. This is exactly when credit scores, credit history and credit reports come into play. No loan application is approved before a detailed analysis of the applicant's credit score and credit reports is made. This is the reason why people with 'not so perfect' credit history, dread applying for loans. So, what are good credit scores and when do you say you have a doomed credit report? Why are lenders so obsessed with your credit score? Let us find out answers to all these questions along with a detailed explanation of credit score scale chart.

What is a Credit Score

Technically speaking, credit score is a statistical technique of determining the probability of an individual repaying his debt within a specific period of time, by evaluating and analyzing his previous credit history (phew!). In simple words, it is a numerical expression of your creditworthiness. Credit scores are granted by three credit bureaus in the US namely, Experian, TransUnion and Equifax. These credit scores are formulated on the basis of a software program developed by Fair Isaac Corporation (FICO), hence also termed as FICO scores. The evaluation is based upon the credit data of an individual, available with the credit bureaus. It is possible that the three credit bureaus have different credit report regarding the same individual, hence he may actually have three different credit scores! Nonetheless, the variation in credit score range is not significant enough to influence the financial fate of a person.

Determinants of a Credit Score

Although, FICO has its own formula for finding the credit score, the variables of that formula are based upon certain known factors. Before we take a look at the credit score rating chart, it would make sense to understand these factors. These factors are as follows:

• Payment history (35%)
• Outstanding current debts (30%)
• Length of credit history (15%)
• Types of credit accounts owned (10%)
• New credit applications (10%)

Credit Score Scale Chart

Now that we know how credit scores are calculated, let us see the actual credit score ratings scale. The FICO scale comprises numbers between 300 to 850 as indicators of the credit scores.

Credit Score	Rating
760 - 849	Excellent
700 - 759	Great
660 - 699	Good
620 - 659	Fair
580 - 619	Poor
580 and below	Very poor

Credit Score Range Evaluation

As evident from the table above, excellent credit scores assure best prospects of getting a loan, that too at lower interests. Most money lenders will find it difficult to reject a loan applicant with such solid credit scores. Even people with credit scores in a range 700 - 759 may not have any difficulty getting loans at desired interest rates. Credit scores below 660 are considered risky and although there is no problem acquiring a loan, you may have to bear higher interest rates. People in the credit score range of 580 to 619 may find it difficult to get loans and even if they do, the interest rates will be very high. People who have very poor credit scores should work upon credit repair before they can hope to get credit. In short, people with credit score in the range of range good to excellent have no reason to worry, while those below that should look for ways to improve credit scores.

This is all about credit score scale chart. If you are interested in getting your credit report then, you can procure it from 'Annualcreditreport.com' free of charge once a year. You can also purchase your FICO scores directly from FICO website. However, avoid getting credit scores from online tests are they are rarely reliable.