Fair Credit Score

What number is considered a bad credit score?

Your credit score is not one of the things you should toy with. Your credit rating can decide whether you get that home of your choice, car of your choice or simply be forced to settle for a lesser grade rather than the exact one you desire or worse still: be denied altogether.

“I don’t have a bad credit score” you might say because your credit score is within the range of 650 to 700 which is generally considered a fair credit score; but just like most things in life, having a fair score may not mark you out as an outright failure, but it has grievous consequences you will not like to find yourself suffer.

Credit score rating within the range of 700 and above is considered generally as good credit scores by various finance related agencies and platforms. Your credit score rating goes a long way to decide what is obtainable from these institutions in terms of quality and quantity.

What is considered a fair credit score?

As stated earlier, without any form of controversy, it is evident that your credit score rating plays a very important role in your life in so many ways beyond your wildest imagination. How exactly does my credit score affect my life exactly? You may ask, well, it is not that complicated. Your credit score affects your life in the following ways:

It says a lot about your personality – Now, your credit score is a cumulative effect or compilation as a result of how responsible you have been with handling money generally as well an evaluation of how faithful you have been when it comes to paying back the loans you have been granted in the past. The import of this is that a low credit score paints you as a potentially high risk and ingrate-someone who will not pay back when borrowed money. And that is exactly the way a potential lender will judge you.

A fair credit score simply tells a potential lender that although you are not a chronic debtor, but you are still a high-risk personality to grant the loan. You are perceived as someone who is just a little better than someone with a low credit score.

The import of these perception is that as much as it is true that you will still be granted mortgage loan or auto loan as the case may be depending on what you want, the issue with having a fair credit rating is that because you are perceived as a potentially high risk who may not pay back just like other people who are in this credit score range.

As a result of this, your lender will want to have more assurances and lesser risk for the money you will be borrowed and that will make them require that you pay a substantial part of the money first especially when it is a mortgage or auto loan. You will also end up paying a higher interest rate in comparison to people with good credit score when eventually granted the loan.

To paint a clearer picture: for an auto loan of $18, 000 dollars, where someone with a good credit score of say 780 will pay just 3.336 % interest, a person with a fair credit score of 650 for example will end up paying a staggering 14.86 % in form of interest. Yes, terrifying isn’t it? I know you don’t want to be treated like a second-hand person or second class citizen because of your credit score, then you really need to get to work and start improving it!

Obviously, the better your credit score, the better your chance of getting the home of your dream and the car of your choice.

Getting personal loans with fair credit score

As a result of the tendency (it is an assurance in the real sense) of lenders to treat lending to a person with a fair credit score with a relative caution and suspicion because of the reputation their credit score creates for them; securing a loan is not that easy as stated earlier. When they eventually get the loan too, it often comes with a relatively high-interest rate. This is probably no news to you anymore having read this article to this stage. What is news is that all hope is not lost anyway. It is not all gloom or despair with no solution.

There are still things you can do and platforms you can explore to still get a loan as you desire and one of them is the peer-to-peer- loan platforms. In spite of your fair credit rating, the peer-to-peer platforms still overlook that fact and still trust you and offer you an opportunity for redemption.

Fair credit score vs other score groups

Just like so many things in life, a lot of people are in the fair credit score range because a lot of people tend to be satisfied with mediocrity. There are the few (many though, just few in terms of comparison) who have good credit scores and yet another lesser number of people with excellent credit score.

Credit Score Rating
750 – 850 Excellent
700 – 749 Good
650 – 699 Fair
550 – 649 Poor
549 and below Bad

If you are in that crowd of people with a fair credit score, you should not be contented. Give yourself the opportunity to maximize credits available to you to make your life better and worthwhile.

How to increase your fair score?

If you are concerned with boosting your reputation by improving your credit score, there are some things you need to work on that will offer you the opportunity for redemption you so desire so that your confidence of getting a loan you have requested can be granted.

The most important one is that you get more serious with your commitment to pay back loans you have been granted. This factor is very pivotal and goes a long way in affecting your overall credit score. A good turn deserves another as the saying goes.

Another thing you really need to watch out for is closing up the accounts you have previously closed indiscriminately. It is seen as though you are trying to cover up something when you do that and that will eventually take its toll on your credit score. So be careful and think twice before closing an account.

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