When you hear “prime,” what’s the first thing that comes to mind? Prime rib?Prime numbers?Optimus Prime? Chances are your brain doesn’t go immediately to anything related to financing. Understanding different credit levels can help you focus on building or maintaining a good credit score.
It’s also important to remember that scoring models from credit bureaus, financing companies and FICO® can range from 350 to 850. So keep in mind that the credit tier you fit into can vary depending on who you’re financing with.
Conditions and Requirements
Depending on your credit score and history, lenders might ask for:
- Proof of income, like a pay stub
- Proof of residence, like a bill
- Personal references
- Down payment
Prime: >680
If your credit score is above 680, congratulations! You’re considered a “prime” customer, and you can typically expect lower interest rates and fewer requirements or documentation to get financed. Rates vary, but prime customers can look forward to interest rates in the single digits.
If you’re considered prime, that doesn’t mean your work is done. Continue to maintain healthy credit habits bystrengthening your financial standingand striving for a lifetime of good credit.
Near Prime: 620-679
Just below prime credit scores are those that are considered “near prime.” Times change and so do scores. If you were in the “prime” range and have experienced something that brought your score down, it’s worth looking into reasons why your credit score dropped.
With scores typically ranging from 620 to 679, these customers can anticipate credit rates in the high single digits or low double digits. They also might be asked to provide additional conditions and requirements.
Sometimes, near-prime consumers simply need to adjust a few of their credit habits to move into prime territory.Knowing how credit works, how credit is built and how often to check your credit report are a few ways to make sure you’re on the right path.
Subprime: <620
Credit scores that are less than 620 are considered “subprime” or “nonprime.” Lenders consider consumers with these credit scores to be higher risk, so those who are subprime will probably be looking at interest rates in the mid-teens and up.
These consumers will also likely be asked to provide conditions and requirements and a higher down payment.
If your credit score is considered subprime, there are steps you can take to help improve it. Knowwhat makes up your credit scoreand begin developing productive credit habits to start getting on the right path.
By Scooter Hendon, GM Financial
Scooter Hendon might work indoors, but his heart is in the outdoors. Whether he's with his family or flying solo, he loves a good camping, backpacking or hiking adventure. When Scooter’s not hitting the road in his Chevy Silverado to a state or national park, he’s saving up for his next trip.
Ready to get in the driver's seat?
See if you prequalify for financing.
Apply Now
FAQs
The time it takes to raise your credit score from 500 to 700 can vary widely depending on your individual financial situation. On average, it may take anywhere from 12 to 24 months of responsible credit management, including timely payments and reducing debt, to see a significant improvement in your credit score.
How to increase credit score by 100 points in 30 days? ›
Steps you can take to raise your credit score quickly include:
- Lower your credit utilization rate.
- Ask for late payment forgiveness.
- Dispute inaccurate information on your credit reports.
- Add utility and phone payments to your credit report.
- Check and understand your credit score.
- The bottom line about building credit fast.
This means you should take care not to spend more than 30% of your available credit at any given time. For instance, let's say you had a $5,000 monthly credit limit on your credit card. According to the 30% rule, you'd want to be sure you didn't spend more than $1,500 per month, or 30%.
Is a 900 credit score possible? ›
Highlights: While older models of credit scores used to go as high as 900, you can no longer achieve a 900 credit score. The highest score you can receive today is 850. Anything above 800 is considered an excellent credit score.
Is 650 a good credit score? ›
As someone with a 650 credit score, you are firmly in the “fair” territory of credit. You can usually qualify for financial products like a mortgage or car loan, but you will likely pay higher interest rates than someone with a better credit score. The "good" credit range starts at 690.
Why did my credit score go from 524 to 0? ›
Credit scores can drop due to a variety of reasons, including late or missed payments, changes to your credit utilization rate, a change in your credit mix, closing older accounts (which may shorten your length of credit history overall), or applying for new credit accounts.
What boosts credit scores the most? ›
Paying your bills on time is the most important thing you can do to help raise your score. FICO and VantageScore, which are two of the main credit card scoring models, both view payment history as the most influential factor when determining a person's credit score.
Why is my FICO score 100 points lower than credit karma? ›
Why is my FICO® score different from my credit score? Your FICO Score is a credit score. But if your FICO score is different from another of your credit scores, it may be that the score you're viewing was calculated using one of the other scoring models that exist.
What habit lowers your credit score? ›
Having Your Credit Limit Lowered
Recurring late or missed payments, excessive credit utilization or not using a credit card for a long time could prompt your credit card company to lower your credit limit. This may hurt your credit score by increasing your credit utilization.
Should I pay off my credit card in full or leave a small balance? ›
Bottom line. If you have a credit card balance, it's typically best to pay it off in full if you can. Carrying a balance can lead to expensive interest charges and growing debt.
To sum things up, the answer is no, it isn't bad to have a zero balance on your credit cards. In fact, having a zero balance or close-to-zero balance on your credit cards can be beneficial in many ways.
Does 0 utilization hurt credit score? ›
While a 0% utilization is certainly better than having a high CUR, it's not as good as something in the single digits. Depending on the scoring model used, some experts recommend aiming to keep your credit utilization rate at 10% (or below) as a healthy goal to get the best credit score.
What is the highest credit score to buy a house? ›
What is a good credit score for buying a house?
- 800 or higher: Exceptional.
- 740-799: Very good.
- 670-739: Good.
- 580-669: Fair.
- 579 or lower: Poor.
Your credit score is a major factor in whether you'll be approved for a car loan. Some lenders use specialized credit scores, such as a FICO Auto Score. In general, you'll need at least prime credit, meaning a credit score of 661 or up, to get a loan at a good interest rate.
How rare is an 800 credit score? ›
According to a report by FICO, only 23% of the scorable population has a credit score of 800 or above.
Can you raise your credit score from 500 to 700? ›
For instance, going from a poor credit score of around 500 to a fair credit score (in the 580-669 range) takes around 12 to 18 months of responsible credit use. Once you've made it to the good credit zone (670-739), don't expect your credit to continue rising as steadily.
Is 520 out of 700 a good credit score? ›
Equifax scores range from 0-700. 380-419 is considered a fair score. A score of 420-465 is considered good. A score of 466-700 is considered excellent (reference: https://www.finder.com/uk/equifax).
What can a credit score of 520 get you? ›
Credit Rating: 520 is considered a bad credit score. Borrowing Options: Most borrowing options are available, but the terms are unlikely to be attractive. For example, you could borrow a small amount with certain unsecured credit cards or a personal loan with no credit check, but the interest rate is likely to be high.
How to raise a 520 credit score? ›
4 tips to boost your credit score fast
- Pay down your revolving credit balances. If you have the funds to pay more than your minimum payment each month, you should do so. ...
- Increase your credit limit. ...
- Check your credit report for errors. ...
- Ask to have negative entries that are paid off removed from your credit report.
