What is a Bad Credit Score? | Chase (2024)

What is a bad credit score? Well, there are several credit score ranges. For instance, 780–850 may be considered "excellent" while 720–780 may be seen as "good." But when it comes to a range that may be seen as bad, a score between 300 (the lowest) and 660 fits into the “poor” category.

A poor or bad credit score may serve as inspiration to manage your credit better. You may need to raise your credit score before finding approval for new lines of credit. Luckily, your credit rating isn’t a static number or singular situation. Motivated to work on improving your credit score? This article explores what poor credit may mean for you and options to help you bring it up.

What is a bad credit score?

VantageScore® calculates the most commonly used consumer credit scores. Within the VantageScore model, a credit score between 300 and 660 may fall into three separate categories:

  • Very Poor: 300–499
  • Poor: 500–600
  • Fair: 601–660

FICO® is another major credit scoring agency. Within the FICO model, a credit score between 300 and 660 may fall into two separate categories:

  • Poor: 300–579
  • Fair: 500–669

These two major credit agencies use similar credit score ranges but calibrate them somewhat differently. In all cases, credit score helps credit lenders, such as banks and landlords, assess potential borrowers. This score works as a tool to help measure your past credit behavior, such as the way you paid your bills, with a representative number.

Who decides if I have a bad credit score?

FICO, or the Fair Isaac Corporation, works as a data analytics company. It sells its distinct credit scoring services to lenders. You can also access your FICO score through the major credit bureaus: Equifax®, Experian™ and TransUnion®.

VantageScore was established jointly in 2006 by the three major credit bureaus because FICO was the only game in town up until that point. It uses the same credit reporting data FICO does to calculate credit scores. But VantageScore prioritizes factors a bit differently. This means you may have different credit score results from each of these agencies.

How do you get a poor credit score?

There are a few types of credit behaviors that are factored into your credit score calculation. Payment history, or your habit of debt repayment, usually counts as the biggest one. For example, if you frequently paid off your credit accounts late or have defaulted on a loan, that would factor into your payment history and potentially lower your credit score.

The mix of your types of credit, like student loans, mortgages and credit cards, can impact your credit score as well. Usually, the more variety the better for your credit rating. If, for instance, you have only a single type of credit card, that might contribute to a lower credit score.

How much of your revolving credit you use can also play a role in your credit score. This is your credit utilization ratio, which measures how much revolving credit you use divided by the total amount of revolving credit that’s available to you. Credit utilization is part of why closing a credit account can sometimes lower your credit score; by decreasing your available revolving credit, your credit utilization ratio increases, which can be seen as risky by lenders.

What does a poor credit score mean for you

The ramifications of having a “poor” credit score may not show up until you apply for credit. Lenders often look at credit scores when deciding how much credit to offer or the rates at which they may do it.

Your credit score can be used by lenders to assess how risky it may be to do business with you. For instance, if you have an excellent credit score you may be seen as low risk for banks, landlords, or other creditors. Whereas someone with the lowest credit score of 300 might be perceived as more of a risk when it comes to loaning them money.

How to find my credit score

You can find out your credit score without impacting it through Credit Journey®. With a Chase Mobile® account, you can enroll in Credit Journey for free and access your credit score, reports and many helpful credit-building tools. This service also offers credit monitoring to help raise your awareness and keep up with how your credit score evolves. Credit Journey helps you keep learning as you become more involved in your credit. You are also entitled to one free credit report a year from the three major credit bureaus.

How to increase your credit score

Learning better credit is in your hands, but you’re not alone. Tools like Credit Journey can show you how to increase your credit score with tangible steps and habitual actions. Credit Journey can also help you with insightful alerts about changes in your credit score. You can find out how your credit score responds to your credit usage and adjust your behaviors as you see fit. Credit Journey can work with you as an accountability partner to help keep you on track to earn a better credit score for yourself step by step.

The best way to build credit is the way that works for you. If you already bank with Chase, you can enable Credit Journey right on your mobile device in your Chase Mobile® app to take a first step toward improving your credit score.

In summary

What is a bad credit score? Turns out there are several ways to answer that question. But even if your credit score is very poor or fair, there are actions you can take to improve it. First you can check your score with Credit Journey to find out where you stand. Then you can use Credit Journey tools like alerts and credit monitoring to help you reach your credit score goals.

What is a Bad Credit Score? | Chase (2024)

FAQs

What is a Bad Credit Score? | Chase? ›

VantageScore® calculates the most commonly used consumer credit scores. Within the VantageScore model, a credit score between 300 and 660 may fall into three separate categories: Very Poor: 300–499. Poor: 500–600. Fair: 601–660.

Is 600 a bad credit score? ›

So what scores qualify as a poor, fair, good or excellent score vary. When it comes to FICO credit scores, the company says a score of 600 is considered a fair credit score. According to a report from Experian®, the average FICO credit score in America was 714 in 2022. So 600 falls below that national average.

Is under 700 a bad credit score? ›

Different sources will have slightly different reads on the situation, but according to Experian, a poor credit score is 300 to 579. A fair credit score is 580 to 669. If you have a good credit score, it's 670 to 739. If you are in “very good” territory, your credit score is 740 to 799.

What would be considered a bad credit score? ›

A FICO score below 580 or a VantageScore of less than 601 is considered a bad credit score.

How bad is a 500 credit score? ›

Your score falls within the range of scores, from 300 to 579, considered Very Poor. A 500 FICO® Score is significantly below the average credit score. Many lenders choose not to do business with borrowers whose scores fall in the Very Poor range, on grounds they have unfavorable credit.

Can I buy a house with a 612 credit score? ›

Credit score and mortgages

The minimum credit score needed for most mortgages is typically around 620. However, government-backed mortgages like Federal Housing Administration (FHA) loans typically have lower credit requirements than conventional fixed-rate loans and adjustable-rate mortgages (ARMs).

Can I buy a car with a 612 credit score? ›

In short, there is no set-in-stone credit score to get a car loan. A poor credit score is not an automatic disqualifier, but it will likely impact your ability to get a loan and a good interest rate.

Is a 900 credit score possible? ›

Highlights: While older models of credit scores used to go as high as 900, you can no longer achieve a 900 credit score. The highest score you can receive today is 850. Anything above 800 is considered an excellent credit score.

Can I buy a house with a 708 credit score? ›

Many conventional loans allow you to borrow with a ”fair” credit score of 620 or higher, though your interest rate may be higher than it would be with a higher credit score. FHA loans can allow scores as low as 500, but will require a higher down payment.

Can I buy a house with a 702 credit score? ›

A conventional mortgage is often best for those with a credit score of 700 or higher. (Generally, the credit score requirement is 620 and above.) Benefits of a conventional loan include: Buy a house with as little as a 3% down payment.

How can I raise my credit score 100 points overnight? ›

10 Ways to Boost Your Credit Score
  1. Review Your Credit Report. ...
  2. Pay Your Bills on Time. ...
  3. Ask for Late Payment Forgiveness. ...
  4. Keep Credit Card Balances Low. ...
  5. Keep Old Credit Cards Active. ...
  6. Become an Authorized User. ...
  7. Consider a Credit Builder Loan. ...
  8. Take Out a Secured Credit Card.

How do I repair my credit fast? ›

If you want to improve your credit quickly, the following strategies could help:
  1. Use a reputable credit repair service.
  2. Prioritize and pay outstanding debt.
  3. Explore secured credit cards.
  4. Become an authorized user.
  5. Develop a budget and stick to it.
Feb 27, 2024

How to erase bad credit without paying? ›

How to remove negative items from your credit report yourself
  1. Get a free copy of your credit report. ...
  2. File a dispute with the credit reporting agency. ...
  3. File a dispute directly with the creditor. ...
  4. Review the claim results. ...
  5. Hire a credit repair service. ...
  6. Send a request for “goodwill deletion” ...
  7. Work with a credit counseling agency.
Mar 19, 2024

How do I raise my credit score 40 points fast? ›

Here are six ways to quickly raise your credit score by 40 points:
  1. Check for errors on your credit report. ...
  2. Remove a late payment. ...
  3. Reduce your credit card debt. ...
  4. Become an authorized user on someone else's account. ...
  5. Pay twice a month. ...
  6. Build credit with a credit card.
Feb 26, 2024

How quickly can you repair credit? ›

Remember, building credit takes time and credit scoring models are based on your activity and account history over time. Simply put, one month of positive on-time payment history is great, but six to 12 months of positive payment history is better and will have a greater impact.

How long does it take to build credit from 500 to 700? ›

The time it takes to raise your credit score from 500 to 700 can vary widely depending on your individual financial situation. On average, it may take anywhere from 12 to 24 months of responsible credit management, including timely payments and reducing debt, to see a significant improvement in your credit score.

Can you get anything with a 600 credit score? ›

Having a credit score of 600 isn't ideal, but it's still possible to get a loan or a credit card. Most loan products will end up costing you more due to higher interest rates. However, with some hard work, you can improve your credit score and open up new, more attractive options.

What can a 600 credit score get you? ›

What Does a 600 Credit Score Get You?
Type of CreditDo You Qualify?
Unsecured Credit CardYES
Home LoanYES (FHA Loan)
Personal LoanMAYBE
Auto LoanMAYBE
1 more row

Can you do anything with a 600 credit score? ›

A 600 credit score can be a sign of past credit difficulties or a lack of credit history. Whether you're looking for a personal loan, a mortgage or a credit card, credit scores in this range can make it challenging to get approved for unsecured credit, which doesn't require collateral or a security deposit.

How common is a 600 credit score? ›

What does having a 600 credit score mean? According to FICO® Score, 15.5% of the population has a credit score below 600, while the average credit score sits at 716.

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