Average Credit Scores Needed for Your Loans
Hopefully, you know your credit score and you've already checked your credit reports for errors and contacted the reporting agencies to correct them if any were found.
However, do you know where your credit score falls when it comes to obtaining a loan or line of credit? What is the cutoff between good credit and excellent credit? How do these classifications affect what loan terms are available?
MyBankTacker takes a look at average credit scores required to qualify for a variety of consumer loans, from buying a car or house to renting an apartment or opening up a new credit card account.
What are some average credit scores needed for loans and lines of credit?
Your credit score affects not only your ability to obtain a loan or line of credit, but also the terms which will apply.
In general, any FICO credit score above 700 is considered to be a good score, but better interest rates are usually given on loans with higher scores.
What Credit Scores Needed for Buying a House?
Excellent credit is considered to be a FICO score of 720 and above. Good credit ranges from 660 to 719, while fair credit is around 620 to 659. Poor or bad credit is usually considered to be 619 and below.
If you’re buying a house, a score of 720 and above will put you into the “prime” mortgage loan rates. Many “subprime” mortgages have been problematic in recent years and not all lenders will write subprime mortgages.
How Your Credit Score Can Affect Your Future Mortgage Rate
|Credit Score Range||30-Year Fixed Rate Mortgage||5-year fixed rate mortgage||7/1 ARM|
What Credit Scores Needed for Auto Loans?
People with a variety of credit scores will be able to obtain a car loan, but the difference will be in the interest rates and the down payment amount.
A credit score of 660 to 700 or higher is required to obtain preferred car loan rates with low interest. Scores between 620 to 659 are the normal for standard car loan rates with slightly higher interest rates. People with scores in the 580 to 619 range may qualify for special auto loan rates with high interest, a substantial down payment, and steady income.
Credit problems shouldn't be a factor in renting a car, however, as most rental agencies don’t have a credit score requirement, simply a minimum amount of available credit on a credit card to cover your rental.
How Your Credit Score Can Affect Your Next Car Loan
|Credit Score Range||60-Month new Car Loan||40-Month Used Car Loan|
What Credit Scores Needed for Renting an Apartment?
Not all landlords perform a credit check, especially mom and pop owners of individual units. However, most larger rental agencies do require a credit check, and the terms vary widely. In general, a score over 620 is enough to land a rental unit in an apartment complex, but luxury apartments or buildings may require higher FICO scores.