Few people take time out to seriously think about their credit score. And then the seriousness of maintaining a good credit score hits hard one day. An auto loan application may be declined or the interest rate on a credit card offer could be sky high. Poor credit hits people in a lot of ways they never imagined. Reviewing your credit score at least once a year would be a good fiscal move. What does a credit score number really mean, though? If your score is a 680, is this a good or bad thing?
The Good Credit Floor
On Experian’s Fico numerical credit score scale, 670 to 739 indicates “good” credit. There is room for improvement with this credit ranking, but the score definitely won’t hurt anyone in any significant way. Decent interest and insurance rates are possible since a score of 680 reveals positive things about the borrower. Something has brought the score below the 740 to 850 delineation of “excellent” credit. Maybe he/she has a high credit card balance or defaulted on a single debt a long time ago. Regardless, a person with a 680 credit score doesn’t appear to be a bad borrower.
If your score is 680, you do need to realize you are on the floor of the credit score. Dropping below this level means “good” credit becomes “fair” credit. While not as negative as “poor” or “bad” credit, “fair” credit means higher interest rates. Certain lenders might not even touch someone whose credit only ranks as fair. So, it would be beneficial to keep the score moving upwards instead of allowing the numbers to trend down.
Ways to Bring Up a Credit Score
Unless your credit logs in as being perfect, you should be making improving a credit score a major priority. When a score currently ranks as good, you simply can following the path of “do no harm” and wait things out. Negative marks only remain on a credit report for seven years. Afterwards, the negative marks fall off. As long as nothing new negatively impacts the score, the number should improve.
Of course, a passive strategy doesn’t move things forward quickly. Proactively acting to improve a credit score becomes the better approach to turn the word “good” into the word “excellent.” So, if a credit card balance is rather high, enacting steps to pay the debt down and off right away would be a good move. Those who defaulted on a debt in the recent past should look into ways of settling the debt and getting the negative mark removed from a credit history. Usually, improving a minor negative mark won’t require any difficult effort.