What Can I Get with a 620 Credit Score?
When you’re applying for new credit, such as a car loan, mortgage, or credit card, it’s a good idea to know your credit score before you start. Your credit score is a three-digit code that is used to give potential lenders an idea of how risky it would be to loan you money. If you know your credit score is 620, your next question is probably “What can I get with a 620 credit score?”
Is 620 a Good Credit Score?
Borrowers with exceptional credit have scores between 800 and 850, while scores between 740 and 799 are usually considered very good. Good credit scores are usually considered to be between 670 and 739. To most lenders, a score of 620 is usually considered a fair credit score. While this isn’t the worst score you can have, it lets potential lenders know that you’ve probably had some credit challenges in the past and there’s some risk involved if they decide to approve your application.
Borrowing with a 620 Credit Score
Different lenders have different criteria for determining whether a credit application will be approved. The best rates and loan terms go to consumers with the best credit scores. Some lenders may immediately reject an application from a consumer with a fair credit score, but some are willing to take a chance on borrowers with less than perfect credit. To compensate them for the risk they’re taking, you may find the interest rate and terms they offer are higher than you were hoping. A high-interest rate may lead to payments you may have trouble affording.
Opportunities for a 620 Credit Score
With a score of 620, you don’t have the best possible credit score, but you’re still likely to find opportunities to borrow money. Shop around to get an idea of your options. Many creditors offer pre-approval, which means they run a soft credit check and then give you an idea of the interest rate they may offer you. A pre-approval isn’t a guarantee of approval, but it does help you to see whether there are lenders that may loan you money.
Obtaining a secured credit card is a way to start building good credit. For this type of card, you’ll deposit money into a bank or credit union, which is held as security for your credit line. After several months or a year, the lender may consider changing it to an unsecured credit card, as long as you’ve made all your payments on time. Another way to build your credit history is with a credit builder loan.
Your Credit Score
Be proactive about your credit by always paying bills on time and by not borrowing more money than you can afford to pay back. Check your credit reports at least annually to verify that the information on them is accurate since errors on credit reports are common and can bring down your score.
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