With good credit scores come significant financial advantages. This includes better loan options, lower interest, and more negotiating power. Yet, many people are unsure of precisely what constitutes a “good” credit score.

This blog will review credit score ranges and factors that could impact your credit scores.

What is a Credit Score?

A credit score is a three-digit number, which can range from 300 to 850, that determines a person’s creditworthiness. Your credit score is based on payment history, which is what your credit report includes.

More often than not, your credit report is used by lenders, landlords, and other organizations to make decisions on whether to offer you a loan or rent to you. Usually, credit reports come from the three major credit bureaus: Equifax ®, Transunion ®, and Experian ®, which collect all your financial information to create your credit report.

So, how’s your credit score calculated? Your credit score is calculated based on a credit score model created by Fair Isaac Corporation, also known as FICO®.

How Are Credit Scores Calculated?

So, what makes up your credit score? Well, five major factors generate your three-digit credit score, according to FICO®.

  • Payment history: Your payment history can have some weight on your credit score. This can include a record of bankruptcies, collections, and delinquent accounts, which can tank your credit score. That’s why it’s crucial to avoid racking up payment problems because it will continue to negatively impact your credit.
  • Credit utilization: This is the amount of credit you use compared to the available amount. If you have a high credit utilization, it can suggest that you’re overextending yourself, which can turn lenders away.
  • Length of credit history: Depending on how well you manage your credit, having a lengthy credit history can positively impact your credit score.
  • Credit mix: Having different types of credit accounts, such as mortgages, credit cards, and loans can be a positive factor only if you manage everything well.
  • New Credit: Opening a new line of credit can positively impact your scores if you are responsible for payments.

It’s also worth noting that your payment history and credit utilization account for 30% to 35% of your credit score, according to FICO®.

What are the Different Ranges of Credit Scores?

Here are the credit score ranges for one of the most popular scoring models, the FICO® Credit Score:

  • Very poor credit 300 – 579

If your credit scores fall between these ranges, you will find it challenging to get approved for loans or any new line of credit.

  • Fair credit 580 – 669

Credit scores along this range are decent. Of course, you will still want to work on positively impacting these credit scores, but lenders will accept them.

  • Good credit 670 – 739

Credit scores within this range mean a lender is likely to approve you.

  • Very good credit 740 – 799

You’re doing a great job! As a result, you will have better chances of securing more lines of credit.

  • Excellent credit 800 – 850

Your credit scores are exceptional! You shouldn’t run into any issues with lenders.

What is a Good Credit Score?

As previously mentioned, good credit scores range between 670 to 739, according to FICO®. Remember, there are other credit scoring models, too, so they may differ.

Why Having a Good Credit Score is important?

Well, if you desire more financial advantages then having a good credit score are important! Good credit scores can open the doors to lower interests getting loans, more negotiation power when getting the ideal loan for yourself, plus access to higher credit limits.

How to Positively Impact Your Credit Score

If you’re looking to positively impact credit score, here are some great ideas to start with:

  • Make all your credit payments on time. Missing a single payment or paying past the due date can negatively impact credit score significantly. If you’re having a hard time remembering to pay your bills, consider autopay to help you stay on top of bills.
  • Dispute inaccuracies in your credit report. If you see any inaccuracies in your credit report, it is worth contacting the three major credit bureaus. Not only does it impact your credit, but it can lower your chances of getting approved for a loan. Also, if you see accounts on your credit report that you didn’t open, that may be a sign of identity theft.
  • Keep your credit utilization low.  A high credit utilization ratio can indicate that you are overextending yourself and maybe a higher risk to lenders. Therefore, keeping your credit utilization below 30% is recommended to maintain a good credit score.
  • Avoid multiple credit inquiries. If you have multiple inquiries within a short time, lenders may view you as a credit risk and tank your credit scores.
  • Don’t close your old credit accounts. A long credit history has excellent benefits. Therefore, try to avoid closing old accounts if you can.

What To Do If You Don’t Have a Credit Score

No credit score means no credit history. But if you’re looking to establish credit, here are a few tips you can follow.

  • Start by opening a credit account. Applying for a credit card is a great first step toward establishing credit. Once you use your credit card, your credit card issuer will report your activity to the major credit bureaus.
  • Use credit responsibility: stay on top of your bills and keep your balances low. This will help to positively impact your credit.
  • Consider a secured credit card: A secured credit card can be a great option if you’re having trouble getting approved for a regular credit card. With a secured credit card, you provide a security deposit that serves as collateral for the credit card.
  • Become an authorized user on someone else’s credit card: Another option is to become an authorized user on someone else’s credit card. The options are great because they allow you to lean on another person’s good credit to establish your own.

How to Check Your Credit Score

  • Check your credit report: You can request your credit report from the three major credit bureaus. Your credit report should include payment history, types of credit accounts and any derogatory marks (such as bankruptcies or collections).
  • Use a monitoring service: The best way to keep an eye on your credit scores is to consider signing up for identity theft protection. This type of service, which you can get through IdentityIQ, offers credit monitoring which watches over your credit scores, reports around the clock, and alerts you whenever something changes.
  • Check with your lender: If you have a credit card or a loan, your lender could provide your credit information.


If your credit scores aren’t ideal, you can always work positively impacting your scores. Just keep in mind credit scores don’t change overnight. It will take time, so be patient, and you will get there.