The business website shows a respectable FICO score between 670 and 739. According to FICO, scores between 580 and 669 are deemed “fair,” while those between 740 and 799 are considered “very good.” A score of 800 or higher is deemed “excellent.”
According to FICO, the average credit score in 2021 was 716, which is in the excellent range.
Fair Isaac Corp., the organization that created the original credit scoring system, is the source of FICO. It uses customer information from TransUnion, Equifax, and Experian, the three leading credit reporting agencies.
FICO scores typically use a number between 300 and 850 to represent a consumer’s creditworthiness.
How To Raise A 670 FICO Score
If your FICO® Score is excellent, you stand a decent chance of being approved for a wide range of loans. However, suppose you can raise your credit rating to fall within the Very Good (740-799) or Exceptional (800-850) credit score categories. In that case, you can be qualified for higher interest rates that could help you save thousands of dollars in interest throughout your loans. Here are some actions you may start taking to improve your credit ratings.
Punctually pay your bills.
You’ve heard it before, but finding a method that works for you and sticking with it is the best approach to raising your credit score. Sticky notes and paper calendars are effective for some people, while automated aids like smartphone reminders and automatic bill-payment programs are for others. You might start remembering on your own after around six months.
Look for a good credit mix.
While it’s never a good idea to take on debt you don’t need, smart borrowing—installment loans and revolving credit—can help you build good credit.
Avoid having high credit use.
To avoid reducing your score, keep your utilization across all accounts below roughly 30%.
Regularly check your FICO Score®.
Monitoring your FICO® Score might give you helpful feedback as you attempt to improve it. Recognize that occasional drops in the score are expected and keep up solid credit habits to see continuous development in the right direction. You might want to use a credit-monitoring service to streamline the procedure.
You might also want to consider using a service that can detect strange behavior on your credit reports and protect you from identity theft.
When Can You Expect To Have A 670 Credit Score?
It depends on your starting point. Once any negative blemishes on your credit are cleared, if you had fair credit when you started, you might find it simple to obtain this score. For instance, three collection accounts might bring a credit score of 800, well below the 600 mark.
If you had poor credit to begin with (you don’t have any revolving accounts, for example), one bad mark might push you well below the 500s.
Can someone with a credit score of 670 obtain a personal loan?
Your loan application will likely be approved if your credit score is 670. Your interest rate, however, can be slightly higher than that of someone with “Very Good” or “Excellent” credit.
Can someone with a credit score of 670 obtain a credit card?
Most credit cards will approve applicants with credit scores in this range. Some credit cards, however, demand a higher score. If you successfully get accepted for a credit card, remember to always pay your bills on time each month and maintain your balance below 30% of your credit limit.
How was your 670 credit score determined?
FICO and VantageScore are the two most widely used credit rating models. Both algorithms use the following elements to construct credit scores, notwithstanding their modest differences:
The lender will perform a credit check when you apply for a credit card or loan. This will lead to a serious investigation. A few points reduce your credit score after a hard inquiry, and the reduction might continue for up to 12 months.
The actual account opening itself can have much more detrimental long-term impacts on your credit score.
If you don’t have a healthy balance between revolving credit accounts (like credit cards and retail credit) and installment accounts, your credit score will suffer (e.g., mortgages, car loans, and student loans).
Credit history length
The age of your oldest and newest credit accounts and the average age of your accounts define how long your credit history has been established. Your credit score is raised when you have long-standing accounts but lowers when you open new accounts.
Credit utilization rate
This term refers to the percentage of your available credit being used (also known as your debt-to-credit ratio). Your credit score will benefit from a lower utilization rate. Many professionals advise keeping yours around 30% (i.e., you should aim to avoid running up a $3,000 bill on a credit card with a $10,000 limit). VantageScore advises maintaining your credit utilization as low as possible, ideally under 10%.
Your credit score is lowered by late payments. Delayed payments will cause more harm to your credit score. Bankruptcies, collection accounts, and charge-offs all tend to lower credit scores even further.
Obtaining personal loans with a 670 credit score
Do you need a personal loan right now? Even though you can be eligible for a personal loan with acceptable credit, you might end up paying more in fees and interest than you would if your score were good or excellent.
Depending on what you need the loan for, these higher rates and fees may make it a less attractive option. For instance, the interest rate on your new loan may not be low enough to save you money over the long term if you wish to consolidate credit card debt with a personal loan, especially in light of all the possible upfront fees.
On the other hand, if you’re taking out a personal loan to pay for a large purchase, you should think about whether you need it right away or whether you can wait. You might be able to be approved for a loan with a lower interest rate if you have the patience to wait and put some effort into improving your credit. On PaydayChampiom, you can compare personal loan possibilities when you’re prepared to go with one.