What is considered a Good Credit Score in 2010?
Credit Card | February 16, 2010 at 5:23 amAlthough there are various disadvantages of credit, one cannot deny the fact that we can’t live without it. No, this doesn’t mean we like it. However, due to many inescapable circumstances, we have to borrow money. However, borrowing is very difficult in the US if you fail to maintain good credit score.
However, what is considered a good credit score?
Before I directly give out the ideal number, let me define few things first. To avoid complication, let us use the most common type of score – FICO Scores. FICO Score of an individual is calculated b
ased on the credit information given by three chief credit rating agencies, TransUnion, Experian, and Equifax.
The FICO software is used by all these agencies to calculate an individual score because it’s impossible to gauge a person’s credibility as he/she will have three different scores. However, there isn’t much difference between these three scores.
Determining what is considered a good credit score is quite difficult but let’s try to narrow down the confusion. Mostly, the score ranges from 300 to 850. According to myfico.com, median score is 723. This means 723 is the point where the bottom half and top half is divided. So, if your FICO score is above 723, it lies in the top half, that means it can be termed as ‘a good score.’
However, we aren’t seeking to get a perfect score. We need as score that is at least liked by the banks, who eventually are responsible to lend us money. Practically, 680 is what is considered a good credit score by banks. Hence, if your score is 680 or above, you will effortlessly get prime credit.
However, people can get credit even if the scores are miserable; but the interest rates are too. So, what is considered a good credit score in regards with interest rates? This information is best explained by Informa Research Services. A thorough study by this research company mentions that people whose score ranged from 680 to 699 availed 30yr fixed mortgage at 4.9% APR. Whereas, score between 700 to 759 got mortgage at 4.72% and score between 760 to 850 got at 4.5%. Hence, if you want to know a score ideal for decreased APR, it’s above 760.
This seems to be a very high figure. However, if you are anywhere around 600 and above, there are many ways to boost your score. You will get ample of information on the web on how to improve your credit score.
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