What is a good credit score?

Your credit score is what defines your creditworthiness among mainstream lenders. Do you know what constitutes a good credit score? Read on to find out.

good credit score
When was the last time you checked your credit score? If you're new to the credit field, you need to know what makes a good credit score. Read on to know more.

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Your credit score helps you determine your creditworthiness. It also helps lenders such as banks and non-banking finance companies to decide if they can sanction loans or cards to you. Furthermore, your credit score has an impact on both the loan amount sanctioned and the interest rate owed by you. Additionally, lenders may reject a loan application if you have a low credit score.

A credit score between 690 and 719 is generally considered good in a range from 300 to 850. A score of 720 or higher is considered superior, while a score between 630 and 689 is considered fair. A credit score below 630 is considered bad credit.

What is a credit score?

An individual’s credit score is a three-digit number that represents their creditworthiness. When you apply for a loan, banks and other lending institutions check your credit score.

A credit score is calculated using many different scoring models, some of which also use other data. One of the factors they consider when determining if you will be able to repay a loan is your credit score.

VantageScore and FICO, the most widely known credit scoring systems, both use 300-850 as their range.

What makes a good FICO score

According to the company’s website, a good FICO score falls between 670 and 739. A credit score of 580 and 669 is considered “fair,” and it it is between 740 and 799, it is considered “very good.” Anything above 800 is considered “exceptional.” 

FICO reports that the average score as of August 2022 was 716, which is considered good.

The FICO report was developed by Fair Isaac Corp., the first company to develop a credit scoring system. TransUnion, Equifax, and Experian are the three major credit bureaus that provide data about consumers.

What qualifies a good VantageScore

VantageScore, another competitor of FICO, produces similar scores using the same credit report data.

It is generally considered “prime” credit if the VantageScore falls between 661 and 780. “Superprime” scores range from 780 to 850, while “near prime” scores range from 601 to 660. Scores below 600 are considered “subprime.” Scores between 780 and 850 are classified as “superprime,” while scores between 601 and 660 are classified as “near prime.” A VantageScore below 600 is considered “subprime.”

A VantageScore 3.0 average of 695 was reported for the second quarter of 2021.

What factors affect your credit scores?

The following are some tried and tested credit behaviors to keep in mind as you begin to establish or maintain a responsible credit history:

Keep track of your bills and pay them on time. In addition to credit cards, cell phones can be reported to the credit bureaus as late or missed payments, affecting your credit score. Whenever you have difficulties paying your bill, you should contact your lender right away. Even if you dispute the bill, it’s important not to skip payments.

Make sure you pay off your debts as soon as possible.

Don’t let your credit card balance climb above the limit. Credit scores may be negatively affected by high balances compared to credit limits.

Don’t overextend yourself when it comes to credit. You may have a negative impact on your credit score if you apply for multiple credit accounts within a short period of time.

Ensure that your credit report is up-to-date. Make sure your credit report contains accurate information and no incorrect or incomplete account information by requesting a free copy. 


Every time you visit Annual Credit Report, you can get a free copy of your credit report from each of the three nationwide credit bureaus. A copy of your reports can be obtained once every four months so that you can keep a close eye on them throughout the year. It won’t affect your credit scores if you check your own credit report or credit score.

This page is purely informational. Line does not provide financial, legal or accounting advice. This article has been prepared for informational purposes only. It is not intended to provide financial, legal or accounting advice and should not be relied on for the same. Please consult your own financial, legal and accounting advisors before engaging in any transactions.



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