What does mean on my credit report? (2024)

FAQs

What is enough credit history? ›

Most lenders (and scoring models) consider anything less than two years of credit history to be little more than a decent start. When you get into the two- to four-year range, you're just taking the training wheels off. Having at least five years of good credit history puts you in the middle of the pack.

A credit score is a three-digit number, typically between 300 and 850, designed to represent your credit risk, or the likelihood you will pay your bills on time.

Having insufficient credit history means you don't have enough information for lenders to assess your creditworthiness properly. You might have an insufficient credit history because you're a young person who. has never taken out a loan or used a credit card.

For a score with a range between 300 and 850, a credit score of 700 or above is generally considered good. A score of 800 or above on the same range is considered to be excellent. Most consumers have credit scores that fall between 600 and 750. In 2023, the average FICO^® Score^☉ in the U.S. reached 715.

A credit score of 900 is not possible, but older scoring models that are no longer used once went up to 900 or higher. The highest possible credit score you can get now is 850.

You can borrow from $1,000 to $100,000 or more with a 700 credit score. The exact amount of money you will get depends on other factors besides your credit score, such as your income, your employment status, the type of loan you get, and even the lender.

Some types of mortgages have specific minimum credit score requirements. A conventional loan requires a credit score of at least 620, but it's ideal to have a score of 740 or above, which could allow you to make a lower down payment, get a more attractive interest rate and save on private mortgage insurance.

If you're not sure where your credit score stands, there are plenty of ways to check it. NerdWallet offers a free credit score, as do many other personal finance websites and some credit card issuers. If you have years of on-time payments and use your credit cards fairly lightly, you probably have a decent score.

Can you be poor and have good credit? ›

Despite what many people think, your credit score is completely independent of your income. People with $20,000 salaries can have good credit scores, just like those with $200,000 incomes can have poor credit scores. Credit scores only look at one thing—your credit history.

What is the lowest credit score possible? Generally, credit scores range from 300 to 850, making 300 the lowest possible credit score. But it's important to note that you typically have more than one credit score. And they may differ depending on the credit-scoring company and when they were calculated.

Your credit score is a major factor in whether you'll be approved for a car loan. Some lenders use specialized credit scores, such as a FICO Auto Score. In general, you'll need at least prime credit, meaning a credit score of 661 or up, to get a loan at a good interest rate.

Late or missed payments can cause your credit score to decline. The impact can vary depending on your credit score — the higher your score, the more likely you are to see a steep drop. Late or missed payments can also stay on your credit report for several years, which is why it is extremely important to avoid them.

A credit score is a three-digit number that measures your financial health and how well you manage credit and debt. FICO scores are a specific type of score that lenders can use when making borrowing decisions. The FICO credit scoring system is the most widely used credit score.

Anything less than two years is considered a short credit history. Once you have established between two and four years of credit, lenders will better understand how well you manage your credit accounts. A credit age of five years will raise your score as long as you've been managing your accounts well.

Although ranges vary depending on the credit scoring model, generally credit scores from 580 to 669 are considered fair; 670 to 739 are considered good; 740 to 799 are considered very good; and 800 and up are considered excellent.

A bad credit score is a FICO score below 580, meaning it falls in the poor credit range. Along the same lines, a bad score in the VantageScore model is one below 601, which would belong in the poor or very poor credit ranges.

What does it mean to have a thin credit file? A thin credit file means you don't have enough credit history for a credit bureau to calculate a credit score. Experian describes a thin credit file as a credit history with fewer than five accounts or accounts that have only been open for a short period of time.