By CreditNinja Reviewed by Matt Mayerle
Modified on May 15, 2024

A 440 credit score falls within the poor credit score range, which is the lowest score range. With this score, you may find financial endeavors difficult. 

Borrowers who have a 440 credit score will be seen as a credit risk, which will limit their ability to borrow funds when they need to, finance assets, and reach certain milestones. If you have a 440 credit score, it may seem alarming, but the good news is that improving your credit score is possible with the right steps! 

Key Takeaways for a 440 Credit Score

Overview of Your
Credit Rating

A 440 credit score is a very poor credit score. Having this credit score can make finances a little challenging.

Borrowing Options With a
440 Credit Score

With a 440 credit score, your borrowing options will be extremely limited. Bad credit loans may be your only option.

Improving a 440
Credit/FICO Score

Paying your bills on time, keeping your debt low, and a diverse credit mix can all help improve your 440 credit score.

Is a 440 Credit Score Good?

By now, you probably know that a 440 credit score is not considered a good score; it’s in the lowest credit score range. Having a poor credit score means a financial challenge. So, for more financial agency, the best thing you can do is try to improve your credit scores. Continue reading to learn more about improvement and about these credit scores in general.

What Can You Get Approved for With a 440 Credit Score?

A 440 credit score will make you look like a credit risk with lenders. According to FICO, about 27% of consumers with a 440 credit score have gone 30 or more days past due on payment within the last 10 years.¹ Because of this risk, finding funding will be challenging. No matter what loan you consider from the list below, there are a few things you can do to improve your chances of approval:

Strategy

Description

Add a cosigner to your loan application

Involve a person with good credit to cosign, potentially improving your chances of approval.

Improve your credit as much as possible

Take steps like paying down debts and making timely payments to boost your credit score.

Increase your down payment

Offer a larger down payment to lower the loan amount and risk for the lender.

Consider bad credit or secured options

Explore loans specifically for those with poor credit, or secured loans that require collateral.

Below, we’ll go over some common loan types out there and how they work:

Personal Loans

If you have looked for funding before, you will likely come across a personal loan. These loans can be small, medium, or large with funding amounts, depending on the lender that you inquire with. Usually, personal loans are unsecured, which means that they don’t involve collateral. There are all kinds of personal loans out there, some of which may be available to low credit scores. However, keep in mind that because of the risk that a bad credit borrower may bring, funding amounts will likely be very small, and interest rates will be high.

Bank Loans

Bank loans include personal loans, credit cards, auto loans, student loans, mortgages, and more. Essentially, any loan a bank offers may be considered a bank loan. Every bank may be different, so it’s important to do your research on the types of loans each may offer (if you are interested in a specific type of loan). Usually, banks cater to borrowers with, at minimum, fair credit scores.

Credit Cards

Credit cards are a form of revolving credit that can be used multiple times. Once you reach your credit limit, you will have to make payments to the card to use it again. Credit cards may be available for borrowers with bad credit scores, but it may be difficult to get one when your score is as low as 440. Secured credit cards may be a borrowing option for you instead of unsecured credit card options. Here are some secured credit cards that may be available for 440 credit scores:

  • OpenSky® Secured Visa® Credit Card
  • Applied Bank® Secured Visa® Gold Preferred® Credit Card
  • First Progress Platinum Elite Mastercard® Secured Credit Card

Auto Loans

Car loans or auto loans help people finance the cost of a new or used car. Generally, these are installment loans that are repaid in equal monthly payments until the loan is repaid in full. When you have poor credit and need a car loan, increasing your down payment can be helpful.

Products To Help Improve a 440 Credit Score

Here are some products that help improve your 440 credit score:

Budgeting Apps

Budgeting apps can be extremely helpful tools for your credit scores and credit history by teaching you to build better financial habits. If you think about it, your credit is really a collection of your financial habits specifically related to your credit accounts. While you can make a budget on your own, budgeting apps can do the work for you. Here are some budgeting apps to look into:

  1. You Need a Budget (YNAB) — This app emphasizes investment in your budget and offers detailed tracking and management tools.
  2. PocketGuard — It helps users prevent overspending by showing how much they have left for the day, week, or month.
  3. Goodbudget — Based on the envelope budgeting method, it allows for digital tracking of envelope balances.
  4. EveryDollar — Created by personal finance guru Dave Ramsey, this app uses zero-based budgeting.
  5. Honeydue — Specifically designed for couples, it assists in managing shared finances.
  6. Wally — This is a personal finance app that tracks expenses and helps you set savings goals.
  7. Simplifi by Quicken — Offers personalized spending plans and subscription tracking to streamline finances.
  8. Personal Capital — While it’s more focused on investments, it also offers tools for tracking spending and budgeting.

Automatic Payments 

Automatic payments/auto-pay, once set up, can pay your monthly bills for you. This can ensure that your monthly payments are paid on time (as long as you have enough funds) and can help build a positive payment history. Setting up auto-pay can be simple; you can contact the bill issuer or set things up through your bank account. Some budgeting apps can also set up auto-pay for you as well. 

Credit Monitoring Services

Credit monitoring services track any changes that happen to your credit accounts and credit history. These can be helpful when trying to improve your credit scores because you can correct any errors that happen promptly, as you’ll know about them right away. Here are some credit monitoring services you can look into:

  1. Experian IdentityWorks
  2. Equifax Credit Watch
  3. TransUnion Credit Monitoring
  4. Credit Karma
  5. Credit Sesame
  6. Identity Guard
  7. LifeLock
  8. PrivacyGuard


Alternative Credit Reporting Services

Alternative credit reporting services can be a helpful tool when you need to build a payment history but don’t have credit accounts in order to do so. With these services, you can get payments like rent, utility bills, subscriptions, etc., reported to the credit bureaus. If you pay these bills on time, it can really help your payment history and, thus, your credit scores. 

Benefits of Improving Your 440 Credit Score

There are lots of benefits that can come with improving your credit scores; here are some to look forward to:

Lower Interest Rates and APRs

When you improve your credit score, the most apparent benefit that you may notice is that you’ll save on interest rates and APRs when borrowing money. This can be a huge advantage, especially for long-term loans like mortgages. It can mean hundreds and even thousands of dollars in savings when you need to borrow money or finance a purchase or expense. 

More Housing Opportunities

When you have a good credit score, you’ll have an easier time renting and buying a home. A good credit score can definitely make you stand out when compared to applicants with poor credit scores and can mean the difference between securing your dream home or having to settle. 

An Easier Time Building Wealth

When you have a good credit score, you’ll have an easier time acquiring assets, which can be one strategy for building wealth. Assets like property/homes, cars, boats, etc., can all help build wealth, which most people acquire through financing. 

More Loan Choices 

With better credit, you’ll have more loan choices, which can be extremely beneficial. With more choices, you can think about what works best for your budget and lifestyle. Which, in turn, will make whatever loan option you choose easier to repay. 

How To Improve Your 440 Credit Score

There are several things you can do to improve your 440 credit score; here are some tips:

Keep Your Credit Utilization Rate Under 30%

Your credit utilization rate measures your existing debt against your available credit. Keeping this ratio under 30% will be helpful for your scores, while going above this percentage can be harmful. You can keep your credit utilization under a good ratio by keeping your debt low and your available credit limits high.

Keep Paid-Off Accounts Open 

Reaching the milestone of paying off a credit account is a great accomplishment! Some accounts, once paid off, will close automatically; usually, these are installment loans. However, lines of credit such as credit card accounts stay open even after they are paid off. It will be helpful to keep those credit accounts open, as closing them can hurt your credit utilization ratio.

Pay Your Credit Accounts On Time 

The most impactful variable for your credit scores is your payment history. And so, it is crucial to make your bill payments on time. Only accounts that are reported to the three credit bureaus will impact your payment history on your credit reports.  

Be Mindful of Your Credit Mix 

Your credit mix accounts for all the different types of credit accounts that are a part of your credit history and credit report. For example, a good mix would include options like credit card debt, an auto loan, a personal loan, a mortgage, and a student loan. While a credit mix that needs work may only have credit card debt. Before choosing a loan, it’s important to think about what exactly is already in your credit history. 

FAQs About 440 Credit Scores

While minimum credit score criteria vary by lender, credit unions often have more flexible criteria. If your credit score is lower than the average credit score, a credit union might still consider your application for a personal loan, especially if you have a history of responsible credit usage reflected in your credit report.

A secured credit card is a fantastic tool for rebuilding your credit score. By providing a deposit that serves as your credit limit, secured credit cards reduce the risk to the issuer, allowing those with poor credit scores to improve their credit reports. Consistent, on-time payments with a secured card are reported to credit bureaus and can significantly enhance your credit score.

Yes, improving your credit score can substantially lower the interest rates offered on financial products like auto loans and personal loans. Lenders use your credit score to assess risk; a higher credit score indicates lower risk, which can result in more favorable interest rates, reducing your overall borrowing costs.

The main difference lies in the credit requirements and the deposit. A secured credit card requires a cash deposit that typically sets your credit limit and is ideal for those with a lower credit score aiming to rebuild their credit. An unsecured credit card does not require a deposit and usually demands a higher credit score. If your credit score is low, starting with a secured credit card might be advisable to help build your credit score.

It’s wise to check your credit report at least annually, though monitoring more frequently can be beneficial if you’re actively trying to improve your credit score or if you have taken out a new personal loan or secured credit card. Regular checks can help you track changes in your credit score, correct any inaccuracies, and see how your financial behaviors, like managing a personal loan or credit card, influence your credit score over time.

What Interest Rate Can I Get With a 440 Credit Score?

Interest rates with a 440 credit score will be high; the exact interest rate that you will get will depend on the loan type you are inquiring about, the lender that you plan on working with, and your specific credit history. The best way to lower your interest rate is to improve your credit score. If you don’t have the time to do that, a cosigner can be helpful.

Can I Buy a House With a 440 Credit Score?

Credit scores are just part of the home buying process; here are some other factors that lenders pay attention to:

  1. Debt-to-Income Ratio (DTI) — This measures your total monthly debt payments against your income. Lenders prefer lower ratios as they indicate a better balance between debt and income.
  2. Employment History — Having consistent employment, especially in the same field, can demonstrate stability and reliability to lenders.
  3. Down Payment — The size of your down payment can influence the terms of your loan, including your interest rates.
  4. Savings and Assets — Showing that you have savings and assets demonstrates your ability to manage finances effectively and cover mortgage payments and potential emergencies.
  5. Property Value and Type — The appraisal value and type of property you intend to buy can affect loan approval and conditions, as some properties are considered higher risk than others.

That being said, an average credit score of 440 is a very poor credit score and usually will not be high enough to qualify for most mortgage loan options. Once you work on improving your credit and get to, at the very least, a fair score, you will have an easier time getting through the credit score inquiry part of a mortgage application.

Top 5 Resources for a 440 Credit Score

Related Credit Scores

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References:

  1. 440 Credit Score: Is it Good or Bad? | Experian
  2. 440 Credit Score: Borrowing Options & How to Fix | WalletHub