Personal Finance 101: What Is A Poor Credit Score?
Personal finance 101 is to do everything to improve your credit score. Honestly, with a good credit score, your life becomes much easier. You can find it easier to borrow cash. Certain jobs may be available to you now. You will have an easier time opening accounts with some companies.
But, how do you know when you need to put a bit more effort into improving your credit score? What is a poor credit score? These are questions you need to answer in order to understand your credit. Here is the information you need to go about understanding and fixing your credit.
What Is A Poor Credit Score?
It can be difficult to define in one way just what is a poor credit score. We know that probably isn't the answer that you are looking for, but it is the truth. A poor credit score to one company may not necessarily be a poor credit score to another company. It is highly dependent on what a company is offering.
If you are applying to borrow thousands of dollars from a traditional bank, then they may regard a credit score of 670 as poor, while a cellphone network may only see scores below 580 as poor. Sadly, companies don't tell you exactly what they might consider a poor credit score.
According to Experian, one of the leading credit reference agencies, any score between 300 and 579 is poor. Any score between 580 and 670 is okay but may be seen as poor by some institutions. So, while we can't give a definitive answer to what is a poor credit score, you should aim to get it as high as possible. If you can get it above 670, you will have more borrowing options available.
How Is A Credit Score Calculated?
The credit reference agencies will never give specifics on how their credit scores are calculated. After all, they do not want somebody to game the system. What we can tell you is that it will be a rather complicated calculation that considers the following:
- How established your credit history is. So, somebody that is 18 will have a 'worse' score than somebody that is well into their 40s here.
- How much credit you currently have issued to you.
- The percentage of utilized credit.
- How often you apply for credit.
- Whether you have a habit of missing payments.
- Whether you have any judgments against you.
Almost your entire financial life will be brought into the equation. The one thing that your credit score won't look at is the money going into and out of your bank account. This means that your savings and employment income will not have an impact on your credit score.
How Long Does It Take To Improve A Poor Credit Score?
Just like asking what is a poor credit score, there is no one answer to how long it takes to improve a poor credit score. Credit scores can take months to improve; some can take years. It all depends on how bad your credit history is. Most people should have no issues recovering from a single missed payment.
However, if you have years of missed payments and high credit utilization, then you will likely need to have years of making payments on time. The one thing that we can tell you is that the sooner you take action to improve your credit score, the sooner you will be able to enjoy the benefits of a good credit score.
Thankfully, improving your credit score shouldn't be too difficult once you know what you are doing. Improving your credit should be personal finance 101 for everyone. This means making payments on time, not applying for too much credit, and so on.
I Have A Poor Credit Score? Can I Still Borrow Money?
While you may not be able to go to a traditional bank and ask to borrow money with bad credit, there may be other options available when you need a loan for emergency expenses. When you come to Carolina Title Loans, Inc., for example, you may be able to obtain an installment loan.
We can offer installment loans of up to $1,500 when you need cash for any emergency expenses you cannot handle alone. An installment loan functions in a very similar way to a traditional bank loan. This means that you borrow an amount of cash and pay it back over a period of time in installments.
Keep in mind we will carry out a credit check when you take out an installment loan. However, we may be a bit more lenient in what we classify as a poor credit score. While we cannot promise anything, we can always sit down with you and go over your chances of getting a fast signature installment loan with us.
We will also consider your situation, e.g. your income, when it comes to whether you qualify. The process for inquiring about an installment loan is simple, too. It can take as little as 30 minutes from the moment you come see us for the in-person appointment.
It starts by filling in a short form on our website and waiting for our phone call. We will go over what you need to bring and set up the appointment. Once done on the phone, grab your state-issued photo ID, your most recent pay stub, and a blank check from an active checking account in your name.
Once you have the items, you can come down to the nearest installment loan SC location for the appointment. We will assess your items and check your credit to determine if you qualify. If you do, you could get the money as soon as the same day.
Inquire About Installment Loans Today
What is a poor credit score? Well, it depends on who you ask. Generally speaking, anything below 579 is poor. If your score is below this, then you may find borrowing difficult. You can always use your personal finance 101 knowledge to boost your credit score in the long term.
However, it may not necessarily help if you need emergency cash now. In this situation, an installment loan could be an option. Get started by filling in a short online form on our site today. You could have the money that you need in a few hours if you are approved.
Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.