WHAT IS A GOOD CREDIT SCORE?

We know that the world of credit and credit scores is overwhelming at times. Building a credit score is not an easy task; building up a high enough credit score to qualify for a loan or lower interest rates is even more difficult.

A credit score represents how reliable or “credit worthy” you are. Your credit files are made up of many different elements including payment history, credit utilization, credit length, new credit, and diversification. A credit score is primarily based on a credit report, we receive these credit reports from credit bureaus. 

There are various credit score requirements in order to apply for different loans and to qualify for the lowest interest rates. Different loan offices, websites, and credit experts set different standards for a good credit score. They are typically divided into five categories. We base our breakdown on what you need to qualify for a home loan in Washington state (typically - as said before, this can vary depending on who is providing the loan). 

Poor- 300-579

Fair- 580-620

Good- 621-720

Very Good- 721-800

Exceptional- 800-850

To put this into perspective…

BUYING A CAR? The recommended credit score to buy a car is 660 or higher. In addition to your credit score your auto insurance score plays into your premiums when buying a car. The higher your score the lower your interest rates will be set. 

BUYING A HOME? To qualify for a regular property when buying a home it is typical to be required to have a credit score of 620 or higher for the most favorable interest rates. The recommended credit score to receive an FHA (Federal Housing Administration) loan is 580. These loans are directed to low-to-moderate income borrowers. 

If you ever have questions, contact us - your expert consultants. 

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Solutions Team