Credit Score Guide: How It Works
What Is a Credit Score?
A credit score is a three-digit number that predicts your likelihood of repaying borrowed money. Scores range from 300 to 850, with higher scores indicating lower risk to lenders.
Score Ranges
Excellent (740-850): Best rates and card approvals. Good (700-739): Most cards available with competitive rates. Fair (640-699): Some approvals with moderate rates. Poor (580-639): Limited options, secured cards recommended. Bad (300-579): Focus on credit repair.
What Affects Your Score
Payment history (35%), credit utilization (30%), length of credit history (15%), new credit inquiries (10%), and credit mix (10%) determine your FICO score. Focus on paying on time and keeping balances low.
Improving Your Score
Pay all bills on time, keep credit utilization below 30%, avoid closing old accounts, and limit new applications. Most improvements take 3-6 months to reflect on your credit report.