What Constitutes an Average Credit Score?

It’s more challenging today to maintain a good credit score than in the past, when a healthier economy gave Americans more financial leeway. Nonetheless, a good credit report is vital to securing a loan or mortgage, and in some cases it counts when it comes to renting an apartment or gaining employment. Taking into consideration that the average credit score is considered to be 720 on a scale from 300 to 850, lenders will give careful consideration to credit scores in the 620-and-above range on a loan application.

It is not impossible to obtain a loan with a lower-than-average credit score, but those creditors who are willing to lend to credit-challenged consumers will boost interest rates for those borrowers. In a lender’s mind, any score under a 680 is subject to scrutiny, and possibly higher rates.

Scoring in the 850 range is almost impossible for any consumer, and an aggressive strategy would have to be in place to achieve a perfect score. Any credit score above 720 is considered high, and creditors will look favorably on a borrower with these numbers in their credit report.

When a consumer begins to establish their credit, the base starting point is generally in the 600 range. There are three credit bureaus that lenders turn to for your credit information — Equifax, Trans Union and Experian. All three of these credit bureaus utilize a point system based on how reliable you are when it comes to paying your debts.

Factors that determine an individual’s credit score can change over time as credit bureaus receive new information and adjust rules. When it comes to maintaining an average credit score or better, remember that any debt, no matter how small, is taken into consideration. What determines the quality of your credit report is how well you can show that you are able to accumulate and then pay off debt in a responsible and timely manner.

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