Is 653 A Good Credit Score
A credit score of 653 is considered to be Fair. With a score in this range, it can be difficult to obtain credit without paying high fees and interest rates. Even though many people have fair scores, some lenders dont like these odds and wont work with consumers with scores in the Fair range. Consumers with Fair credit scores may be targeted by lenders who specialize in subprime borrowers that often charge exorbitant fees and interest rates.
Should I Still Aim For A Higher Credit Score
Now that you have read about the different types of mortgages and their credit requirements, its time to ask yourself your particular needs and preferences for the kind of mortgage you want to get.
- Are you looking for a mortgage youll stick with forever, or will you be open to get refinancing when there are better rates in the future?
- How long do you plan on staying in your new home?
- How much down payment are you willing to make or capable of paying?
- Are you buying a house in a rural area?
Keep in mind that the lower the down payment you make, the more expensive your loan becomes. It may seem easier on the pocket now to settle for lesser home equity, but your future self will definitely not thank you for it.
Based on what you decide, though, this is only when youll be able to tell for yourself if youll need a higher credit score. In general, its always a good idea to work on your credit, especially if youre planning to get a mortgage, but if you already have it in the bag, its probably just a way of gaining undue stress and anxiety.
The more expensive the home youre trying to buy, the closer to 700 youll want to get your score. Beyond this number, though, it wont really matter as much because as long as you dont have a very poor credit score, lenders will most likely end up loving you.
How To Improve Your 650 Credit Score
The average FICO® Score is 711, somewhat higher than your score of 650, which means you’ve got a great opportunity to improve.
70% of U.S. consumers’ FICO® Scores are higher than 650.
What’s more, your score of 650 is very close to the Good credit score range of 670-739. With some work, you may be able to reach that score range, which could mean access to a greater range of credit and loans, at better interest rates.
The best approach to improving your credit score starts with a check of your FICO® Score. The report that’s delivered with the score will use details from your unique credit report to suggest ways you can increase your score. If you focus on the issues spelled out in the report and adopt habits that promote good credit scores, you may see steady score improvements, and the broader access to credit that often comes with them.
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Usda Loan With 650 Credit Score
The minimum credit score requirements for USDA loans is now a 640 . Therefore, with a 650 credit score, you will satisfy the credit score requirements for a USDA loan.
Other requirements for USDA loans are that you purchase a property in an eligible area. USDA loans are only available in rural areas, as well as on the outer areas of major cities. You can not get a USDA loan in cities or larger towns.
You also will need to show 2 years of consistent employment, and provide the necessary income documentation .
What Kind Of Home Loan Can I Get With A 650 Credit Score
Through December 31, 2022, Experian, TransUnion and Equifax will offer all U.S. consumers free weekly credit reports through AnnualCreditReport.com to help you protect your financial health during the sudden and unprecedented hardship caused by COVID-19.
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A credit score of 650 leaves considerable room for improvementit’s regarded as a “fair” score by credit scoring model FICO®. A FICO® Score of 650 meets some lenders’ minimum requirements for a mortgage loanbut credit scores aren’t all mortgage lenders look for when deciding how much to lend you or what interest rates they’ll charge.
Learn More About Your Credit Score
A 650 FICO® Score is a good starting point for building a better credit score. Boosting your score into the good range could help you gain access to more credit options, lower interest rates, and reduced fees. You can begin by getting your free credit report from Experian and checking your credit score to find out the specific factors that impact your score the most. Read more about score ranges and what a good credit score is.
With A 650 Credit Score You Can Expect To Pay More In Interest Than Those With A Higher Rating Regardless Having A 650 Score Is Not A Total Loss
Do you have 650 credit score? Do you want to improve your credit score?
A 650 credit score is considered fair and would classify you as an subprime borrower.
Good news is that it shouldnt take too long to gradually improve your credit rating for more affordable rates and terms.
In fact, to achieve good credit status, all you need is a 670 score and youd be in a whole new category.
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How To Go From 650 Or 685 To A 720 Credit Score
There are a few essential steps you need to take in order to raise your credit score by 50 points, or even 100 points. First, youll need to know the Five FICO Factors:
You can attack your credit repair journey by focusing on these 5 factors. Credit Util contributes for 30% of your score so that a great place to start.
If you already have a poor payment history, you cant change that overnight, but you can affect it once your focus on your Credit Utilization Ratio.
What Does It Mean To Prequalify For A Personal Loan With A 650 Credit Score
Some lenders will offer you a pre qualified loan without requiring additional information. Generally, you just need to accept the terms and conditions and the lender will fund the loan. Others will require more information from you. In those cases, the prequalification is simply a starting point to let you know what you could qualify for if you meet their criteria.
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Getting A Car Loan With A 650 Credit Score
In Canada, the minimum credit score required for a car loan is between 630 to 650. So, with a 650 credit score, you can easily qualify for a car loan because the car itself serves as collateral for the lender. If renting a car with a debit card instead of a credit card, the rental company might request your credit history to evaluate and determine your credit rating.
How To Find The Best Credit Cards If Your Fico Score Is 650 To 699
When you reach a FICO score between 650 and 699 your credit card options start to open up considerably.
One type of card that is less relevant after you reach this credit score range is a secured credit card. These cards are more suitable if your credit score is below 650, and especially when its below 600.
But in the average credit score range, you should be able to qualify for unsecured cards with very little effort. What you wont find available to you are unsecured cards with the best terms on the market. For example, you wont qualify for the lowest interest rates, nor will you be eligible for the cards with the most generous rewards programs. But you can still get a card with an adequate credit limit, and at least some cash back rewards. And if you pay your balance off monthly as we will recommend throughout this guide the high interest rate wont matter so much.
Read more:How to Use a Credit Card Responsibly
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Secured Vs Unsecured Cards
Secured cards are just what the name implies. The amount of your credit line is typically based on the security deposit you put up. For example, if you make a $300 deposit, youll usually have a corresponding $300 credit limit.
Other than the security deposit, secured cards work just like unsecured cards. You run charges and make monthly payments. The payment history is reported to the major credit bureaus, which will impact your credit score. And even though there is a security deposit, you will still be charged interest on outstanding balances.
Secured cards often come with no annual fee or a very low one. Most will eventually increase your credit limit based on your on-time monthly payments. And some will convert your card to unsecured after a certain amount of time.
Read more:Best Secured Credit Cards
Naturally, no security deposit is required for unsecured cards. But the annual fee may be higher than it is for a secured card. The table below summarizes the difference between secured and unsecured credit cards:
Note: All cards on this page selected for credit scores between 650 and 699 are unsecured.
Benefits Of A 650 Credit Score
A 650 credit score shows lenders that you have a reasonable credit history, but they may still be hesitant to lend you money. With that said, there are certainly still benefits of fair credit, compared to bad credit.
Access to loans: 650 is a good enough score that you should be able to start accessing loans although you may pay higher interest rates. Auto loans, payday loans and other types of financing are often available at this credit score level.
Access to credit cards: At a score of around 650, credit cards become an option for some borrowers. Scores lower than 650 may require the use of a secured credit card, which requires a deposit. Unsecured credit cards for a 650 credit score allow you to utilize credit cards without having to put down a deposit. Some of the best credit cards for a 650 credit score might even offer rewards.
A good base to build credit: Having a score in the 650 range means that you have a fair baseline of credit history to build from. A 650 score expands your access to credit products, which can make it easier to continue building credit and improving your score.
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What A Fair Credit Score Means For You:
Borrowers within the “fair” credit score may push interest rates higher for their lines of credit. Borrowers in this range may incur higher charges associated with a loan or line of credit. It may be difficult to obtain a 30-year mortgage at the lower end of this range and you may expect higher interest rates. Auto loan APRs may have higher rates and credit cards may have lower limits and higher APRs.
Use Your Understanding Of Credit To Build Your Credit Score
The first step in your credit journey is understanding what a credit score is and how it is calculated. Once you know the basics about credit score, you can begin to improve your credit score. Doing so doesn’t simply improve your standing in the eyes of lenders, but it can also save you thousands of dollars in interest payments over the course of your lifetime.
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What Is A Fair Credit Score
- According to FICO, a Fair credit score ranges between 580 and 669.
- VantageScore says a 601 to a 669 is a Fair credit score.
Fair credit falls in the middle of the credit score scale. Around 17% of Americans have Fair credit ratings.
Apply For And Open New Credit Accounts Only As Needed
Opening a new credit account is beneficial for those who do not have a credit history or do not any credit account. But, for consumers who have existing credit accounts, opening a new one can negatively impact their credit score. Credit age is a huge factor in determining the FICO score. A younger credit account means a lower credit score.
You have to remember that opening a credit account is a huge decision. Before opening a credit account, you have to be sure first that be responsible in using it. You should never take granted even a single card.
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What Are The Pros And Cons Of A 650 Credit Score Personal Loan
The disadvantages of a 650 credit score are that you may have a more challenging time qualifying for credit than if your score were higher. You might have to provide your lender with more information to qualify for credit. You might also have a higher rate, origination fees, qualify for a lower amount and a shorter-term than if your credit rating were higher.
Dispute Negative Accounts On Your Credit Report
Its a good idea to grab a copy of your free credit report from each of the three major credit bureaus, Equifax, Experian, and TransUnion to see what is being reported about you. If you find any negative items, you may want to hire a credit repair company such as Lexington Law. They can help you dispute them and possibly have them removed.
Lexington Law specializes in removing negative items from your credit report. They have over 18 years of experience and have removed over 7 million negative items for their clients in 2020 alone.
They can help you with the following items:
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How Long Does It Take To Rebuild A Credit Score
There is no definite length of time when it comes to rebuilding a credit score. For some, it takes years to rebuild a credit score. While for others, it may take decades to do it. The time you need to achieve high credit scores depends vastly on your credit profile and personal finance.
If you have a 650 credit score, it is a short leap toward a 670 credit score, which is considered a good rating. You have to focus on the significant factors when it comes to improving a credit score. Pay your credit on time and main a low credit utilization.
One important lesson here is that you have the power and the ability to improve your credit score. Reading about the factors that influence your credit score, you have to pay attention to which of these factors you need improving. You must come up with a plan of attack. Decide how you wish to manage your loans, credits, and finances.
Fair Vs Good Credit Score
You want to get the highest credit ratings possible, so you can save money when you need a loan or credit. If you have a Fair credit score, lenders will consider you subprime. This means you will likely receive less favorable terms than someone with a higher credit score. This can result in higher interest rates or possibly a rejected application.
Can You Get Insurance Plans With A 650 Credit Score
Yes, you can get any insurance policy that you desire with a credit score of 650.
A 650 credit score is not considered a decent one with respect to a loan. However, people can try and work on this score to improve it with the help of the methods mentioned above, as the banks or lending institutions will favour them more concerning the same.
Can I Buy A Car With 655 Credit Score
You should be able to get a car loan with a 655 credit score without a problem. Truthfully, people can get a car loan with almost any credit scorethe difference will be what kind of interest rate you can secure. A score of 655 may get you an interest rate of between 11.92 percent and 4.68 percent on a new car loan.
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Where To Go From Here
Its important to know which factors make up your credit score. As you can see in the image below, there are 5 factors that make up your credit score.
Pay down your balances and keep your credit utilization under 30%. Its also wise to have different types of credit accounts to establish a solid credit mix because it accounts for up to 10% of your FICO score. So, youll want to have both installment and revolving credit showing up on your credit report.
Of course, you also want to focus on making timely payments from here on out. Even one late payment can be very damaging to your credit.
Length of credit history also plays an essential role in your credit scores. You want to show potential creditors that you have a long, positive payment history.
Building good credit doesnt happen overnight, but you can definitely speed up the process by making the right moves. So give Lexington Law a call for a free credit consultation at and get started repairing your credit today! The sooner you start, the sooner youll be on your way to having good credit.