Having a 600 credit score might make getting a traditional bank loan more difficult. You may not be able to get a very large loan if you’re approved at all. And if you are able to get approved for one, the interest rate you’re offered may be higher than those offered to prime customers.
Your credit score is a big part of your financial journey. Having a good one can help you get good interest rates, larger loans, and good repayment terms. Essentially, it’s easier to get access to loans, credit, and favorable terms with a good score. Having bad credit on the other hand can make life difficult. It’s certainly not as easy to be approved for loans, and the interest rates offered are certainly higher than if you had good or excellent credit.
But what exactly is bad credit? Well, there’s a range of credit scores from bad to excellent. The FICO Score model ranges from 300 to 850, with higher scores being better. The following breakdown should help you to understand exactly where you fall on the scale:
- 300 to 580: Bad credit
- 580 to 669: Fair credit
- 670 to 739: Good credit
- 740 to 799: Very good credit
- 800 to 850: Excellent credit
Based on this scale, you can see how you stack up and how lenders may view your credit score when you apply for a loan or credit card. Basically, any score below 580 will make your financial life more difficult. Even people with scores that range from 580 to 669 may have a tough time getting the cash that they need at a good rate.
The best advice anyone can give you is to make a focused effort to improve your score over time. This will take quite a bit of hard work and determination, but it is possible. The best steps you can take right now are the following:
- Always make payments on time, for everything!
- Lower your overall credit card usage
- Make extra payments on any loans that you can, until they’re paid off
- Avoid applying for new loans if you already have several
Credit Education & Credit Reporting