Ah, credit. It’s what we’re all here to get more of, right? When most people think about their credit, they think in terms of what credit products they really, really want to apply for. They think about all of the things that they could buy — if only someone would give them a chance. If only someone would take a little understanding into play and help them out.
Well, that’s all what lenders try to do. See, it’s all about running a business, but when you’re in the business of giving people things that are of great value, you really want to make sure that the person isn’t going to leave you empty handed. That’s where checking credit comes into play in the first place. The lender has to make sure that they’ve looked into your background.
Now, you might wonder what type of credit score you really need in order to get exactly what you’re looking for. The answer here is that there’s no set credit score that will get you approved or unapproved. Every lender reserves the right to set their own limits. They might say that anyone that has a credit score below 650 isn’t eligible for credit terms, but it could be a bit more generous — someone that has a credit score of 600 or better could get in, while someone that has a credit score of 550 or 575 or even 595 might have to try again later.
The credit formula is based on a lot of different things, depending on which authority is doing the scoring. No matter which authority you’re talking about, the truth is that it’s based on how many accounts you have, what type of accounts you have, how much is actually being loaned to you and how often you pay those accounts. If you’re someone that pays on time and never misses a due date and keeps a low balance on all of your cards — chances are good that you’re going to have a great score.
If you’ve had collections, judgments, liens or bankruptcies, then your score is going to be damaged for a while.
A great score is considered to be about 700 or higher, in most cases. That’s when you really qualify for the best offers from banks, insurance agencies, and other financial institutions. We hope that helps answer your question a little bit better, but feel free to sound off in the comments if you’re not sure!