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Having a really high credit score is very helpful when you want to apply for a new loan product, insurance or utilities, or rent an apartment.
Many consumers worry that having a fair credit score will prevent them from qualifying for the best credit cards or loans. If you have a fair credit score, you can still use that credit score to qualify, but you may end up with less desirable interest rates and loan amounts.
Keep reading to understand what it means to have a fair credit score, how you can improve your credit, and what types of credit cards you can qualify for.
What does a fair credit score mean?
According to FICO, a “fair” credit score is in the range of 580 to 669. A score in this range can qualify you for a credit card or loan, but you’re likely to incur high interest rates. And you may not be eligible for credit cards with better rewards, perks, or promotional annual interest.
Credit rating ranges
Lenders define “good” credit in different ways, so you may not know until you apply if you’ll be approved for a loan product or get a better rate. However, you can get a good general idea of your credit history from your credit score. The two biggest creators of credit scores are FICO and VantageScore. Here’s how they figure it out.
| FICO | VantageScore | ||
|---|---|---|---|
| Credit rating | Score range | Credit rating | Score range |
| Exceptional | 800-850 | Perfect | 750-850 |
| Excellent | 740-799 | Good | 700-749 |
| Good | 670-739 | Fair | 650-699 |
| Fair | 580-669 | Poor | 550-649 |
| very poor | 300-579 | very poor | 300-549 |
How can I improve my credit?
It’s always a good idea to work on improving your credit score. Here are a few steps you can take to improve your score.
- Make timely payments. Get in the habit of paying your bills on time each month. When you make payments 30 days past the due date on a credit card or other account, these late payments are reported to the three major credit reference agencies (Experian, TransUnion and Equifax), which can result in a 100 point or more decrease in your credit score. .
- Reduce your credit utilization ratio. How much of your available credit you use is represented by your credit utilization rate. The lower this ratio, the greater the benefit to your credit score. One of the easiest and fastest ways to improve your credit score is to pay off your credit card balances. When you do this, you quickly improve your credit utilization ratio.
- Become an authorized user. If you’re struggling to get a credit card due to a low credit score, you could be an authorized user of an account owned by someone you trust, such as a parent, spouse, or close friend. Your credit score will benefit if your account is managed responsibly. The primary cardholder is responsible for making payments on the account, so be sure to consider how you will pay for any charges you are responsible for.
- Apply for a secured credit card. Secured credit cards are for those who are building their credit. They can often be obtained with little or no credit, and some issuers allow you to “switch” to an unsecured credit card after you demonstrate responsible use of credit. But keep in mind that you must provide an upfront deposit that will serve as your credit limit. In addition, some secured cards have higher fees than a regular unsecured card from a major issuer.
- Limitation of credit requests. Be careful not to apply for too many credit cards at the same time. When you apply for a card, the issuer will retrieve your credit report, known as a hard request, to assess your creditworthiness. Difficult questions usually lower your score by about five points, although the effect is temporary. However, many loan requests will add up in a short amount of time, and they can send a message to potential lenders that you are a risky borrower.
Credit cards for fair credit
If you have a good credit score, you can still qualify for a credit card. Responsible use of this card can help you improve your credit score. Below are some credit cards that allow you to get a fair credit score – they all require a credit score between 580 and 740 (fair to good).
You can learn more about each of these cards here.
bottom line
The higher your credit score, the better the rates and terms you will qualify for when applying for a credit card. Having a higher credit score can also come in handy when buying insurance or looking for an apartment.
However, a fair credit score can still put you on track to achieve your financial and personal goals while you work to improve it.
Editorial disclaimer
The editorial content on this page is based solely on the objective judgment of our contributors and is not based on advertising. It was not provided or ordered by credit card issuers. However, we may receive compensation when you click on links to our partners’ products.
