How Credit Works

What is the Credit Score Range?

By Michelle L. Black
Reviewed by Lauren Bringle, AFC®

A credit score ranges from 300-850 typically, and serves as a guide to help lenders and others decide whether to do business with you. Not only do lenders routinely rely on credit scores to determine if they should approve or deny new applications, credit scores also help companies figure out how much to charge. In other words, your credit score can affect the interest rate and fees you pay when you borrow money.

Two of the most popular brands of credit scores in the United States are FICO and VantageScore, though each credit score is calculated slightly differently. The majority of U.S. lenders (over 90% to be precise) use FICO Scores in their lending decisions.[1] Most FICO Scores range from 300 to 850, and newer versions of VantageScore credit scores feature the same numerical scale.

It’s difficult to pinpoint the exact cutoff point between a “good” credit score and a “bad” one. Individual lenders decide these credit score thresholds for themselves. Yet as a general guide, a FICO Score of 670 or higher may be considered good. Meanwhile, a bad credit score might be any number that falls below that level.[2]

You may be interested to learn that the average American has a good credit score. In 2020, Experian reported that the average FICO® Score was 711.[3] Keep in mind, of course, that the average credit scores for your state might vary from consumers in the rest of the nation. There are also things you can do to try to improve credit scores if your numbers are below average.

In this article

Many different credit scores

Your credit score is calculated by a special computer program called a credit scoring model. But you don’t have just one credit score. There are many different credit scores that lenders and other types of businesses can use to predict your borrowing risk.

There are different brands of credit scores, such as FICO and VantageScore. Then, there are scores built for lenders in specific industries like mortgage, auto, and credit card lending.

Both FICO and VantageScore also update their scoring models from time to time. Some lenders may use the most up-to-date version of a scoring model while many use credit scoring systems that are years or even decades old.[4]

Although dozens, perhaps even hundreds, of credit scoring models are commercially available, they all work in a similar (albeit not identical) way. A scoring model analyzes your credit report from one of the three major credit bureaus—Equifax, TransUnion, or Experian. The model then assigns you a number based on the details in that report, such as your history of managing debts.

Learn more factors that go into your credit score.

FICO and VantageScore scoring models predict how likely you are to default on a credit obligation (aka pay late by 90 days or worse) within the next 24 months.[5][6]

When a credit scoring algorithm indicates that you’re more likely to default on credit obligations in the future, your credit score will be lower. A higher score, by comparison, means you’re less likely to default and are therefore a better risk for the lender.

Credit score range charts

Most credit scores fall between 300 to 850. Below you’ll find several different types of credit scores along with their numerical ranges. There’s also a general guide to show you how lenders might interpret your score, depending on where it falls on each scale.

Credit score range for FICO

FICO score range

Source [7][8]

In addition to the base FICO Scores above, there are industry-specific FICO Scores as well. FICO Auto Scores and FICO Bankcard Scores are two examples. These credit scoring models feature the following credit score ranges:

  • FICO Auto Scores: 250-900
  • FICO Bankcard Scores: 250-900
Some lenders also pay FICO to create custom scoring models. The credit score ranges on custom models can vary according to the lender’s requests.

It can be confusing to realize that different lenders may use different FICO Score versions to analyze your credit reports. But the good news is that higher credit scores on industry-specific and custom scoring models still boil down to the same result.

As a borrower, higher scores mean that lenders are more likely to approve your applications and to extend you better offers on financing.

Credit score range for VantageScore

This chart shows the credit score range for the VantageScore 3.0 and 4.0 models.

VantageScore range

Source[7]

Note: Earlier versions of VantageScore credit scores didn’t feature a 300 to 850 scale. VantageScore 1.0 and 2.0 each had a credit score range of 501 to 990.[9]

Credit score range for Equifax, TransUnion, and Experian

When you apply for a loan or credit card, a lender may check your credit report and an associated score from one or more of the major credit bureaus. But the credit score range doesn’t vary based on the credit bureau from which the lender purchases your report. Rather, the credit score range is determined by the scoring model the lender uses.

If a lender uses VantageScore 4.0, your credit score will fall between 300 and 850 on any of your three credit reports. By comparison, your score on any report would be somewhere between 250 and 900 if the lender uses a FICO Bankcard scoring model to assess your creditworthiness.

It is possible to receive a different credit score from each credit bureau, even if the lender uses the same scoring model to analyze your three reports.

Take a mortgage application, for example. When you apply for a home loan, a lender will review all three of your credit reports and scores. The lender may check your Equifax, TransUnion, and Experian credit reports on the same day and use the same scoring model for each. But you’ll probably get three different credit scores.

The reason your credit scores can differ between credit bureaus, even if the same scoring model is used, is because your credit reports from the three credit bureaus aren’t identical.

For example, your Equifax report might list an extra account that’s missing from TransUnion and Experian. Or perhaps the credit utilization ratio on one of your credit cards is different on your Experian credit report than it is on the other two.

If the information on your credit reports doesn’t match, you shouldn’t expect your credit scores to match either.

What credit score range is needed to buy a house?

When you feel ready to buy a house, it’s important to make sure your credit is in order. Your credit scores will need to be higher than the lender’s minimum credit score cutoff point to qualify for a mortgage.

Most mortgage lenders review your credit reports from all three credit bureaus and your FICO Scores based on those reports. Your middle credit score, not the highest or lowest score, must satisfy the lender before it will approve your mortgage application.

Credit score range for FHA

Mortgages backed by the Federal Housing Administration, otherwise known as FHA loans, are often a good fit for first-time home buyers. They may also work well for borrowers with less-than-perfect credit or those who want to provide a smaller down payment when they purchase a home. Although it’s a bit of a long shot, you might even qualify to buy a house with no credit using an FHA loan.

To qualify for an FHA mortgage, your middle credit score generally needs to fall into one of the following credit score ranges[10]:

  • 10% Down Payment: 500-579
  • 3.5% Down Payment: 580-850
However, it’s important to understand that some lenders may have stricter approval requirements than those listed above. If your credit score is below 580, you may need to shop around to find a mortgage lender that’s willing to work with you.

Credit score range for conventional mortgage

You’ll generally need a middle FICO Score between 620 and 850 to qualify for a conventional mortgage loan. And as with FHA loans, you could face different credit score requirements from different lenders.

Trying to compare FHA vs. conventional loans? Conventional mortgages might be a more affordable option for certain home buyers. If you have decent credit or are able to supply a larger down payment, a conventional loan is worth considering.

Credit score range for a VA loan

Many lenders want you to have a middle credit score somewhere between 620 and 850 before they will approve your application for a VA loan.[11] Yet the minimum credit score requirements for VA loans (like FHA loans) can vary depending on where you apply for financing. The Department of Veterans Affairs itself doesn’t set a minimum credit score requirement for borrowers seeking VA loans.

Those who qualify for VA loans—such as service members, veterans, and surviving spouses—can enjoy some great benefits. For example, down payments may be smaller or waived all together, interest rates may be lower, and there are no private mortgage insurance requirements.

You should take some time to research the perks of VA loans if you think you’re eligible for this type of financing. You can also compare VA loans vs. conventional mortgages to help you make a better-informed decision.

Why is it important to strive for a higher credit score range?

Bad credit comes at a high cost. That’s why moving up into a higher credit score range can make a meaningful difference in your financial life.

Some benefits of credit include that it could improve your chances of qualifying for the loans or credit cards you want. It may also make it easier to lease a home or apartment. And, of course, a higher credit score range could save you money in the form of lower interest rates and lower insurance premiums.

FICO provides a Loan Savings Calculator that shows how your credit score range can impact the price you pay for a mortgage. Below is a hypothetical example of the money a higher credit score range might save you on a $300,000 mortgage (30-year, fixed-rate).

Loan savings Potential

Source[12]

In the most extreme example above, moving from a credit score range of 620-639 up to 760-850 could help you save:

  • $93,417 in overall interest paid
  • $260 per month

How can you quickly raise your credit score range?

Working to build your credit is a wise use of your time and energy. And while there’s no magic wand that will raise your credit score range overnight, there are some common strategies that may be worth exploring.

  1. Check your credit reports for errors. When a credit report contains incorrect, negative information, it can be detrimental to your credit score. So, you should review all three of your credit reports often. You can dispute credit reporting errors with Equifax, TransUnion, or Experian.
  2. Establish credit if needed. Positive, well-managed accounts have the potential to help you build your credit over time (assuming the lender reports them to the credit bureaus). You may want to start with a credit builder loan or secured credit card if you have no credit or damaged credit at present.
  3. Become an authorized user. If you’re fortunate enough to have a family member or friend who’s willing to help you, you might consider asking a loved one to add you as an authorized user onto an existing credit card account. Becoming an authorized user might help your credit score if the account is positive and the card issuer reports it to the credit bureaus.
  4. Pay your bills on time. The biggest portion of your credit score is based on your payment history. Unless you want your progress to stall, it’s critical to avoid late payments at all costs.
Have no credit score or a bad credit score? Self provides step-by-step credit building tools that could help. Learn more or get started at Self.inc.

Sources

  1. The official website about FICO® Scores.
  2. "What is a Good Credit Score" by Experian
  3. "What is the average credit score?" by Experian
  4. FICO Scores Versions by myFICO
  5. FICO Scores FAQ on the official website for FICO Scores
  6. "How do late payments impact credit scores?" by VantageScore
  7. "What is a good credit score?" by Experian
  8. "What is a credit score?" by myFICO
  9. "Why Do I Have So Many Credit Scores With One Credit Bureau?" by Experian
  10. "Credit requirements for FHA loans" by FHA.com
  11. "Conventional loan rates and requirements for 2020" by The Mortgage Reports
  12. Loan savings calculator by myFICO

About the author

Michelle L. Black is a leading credit expert with over 17 years of experience in the credit industry. She’s an expert on credit reporting, credit scoring, identity theft, budgeting and debt eradication. See Michelle on Linkedin and Twitter.

About the reviewer

Lauren Bringle is an Accredited Financial Counselor® and Content Marketing Manager with Self Financial – a financial technology company with a mission to help people build credit and savings. See Lauren on Linkedin and Twitter.