A credit score, a numeric summary of your credit history, generally ranges between 300 and 850. But what does the number mean to you?

There is no single “cutoff” score used by all lenders, and there are many additional factors besides your credit score that lenders use to determine whether to give you credit and at what interest rate. So it’s hard to say what a good score is outside of a particular lending situation. For example, one auto lender may offer lower interest rates to people with scores above, say, 680; another lender may use 720, and so on.

There are seven categories that consumers can fall under in regards to their credit report.  They are listed below in order from best to worse:

Excellent

Your credit score is above 800. Lenders and insurers view you as an excellent credit risk. You probably have a long history of using credit responsibly. Your credit report likely contains multiple credits and loan accounts that have all been paid on time for years. You have no public records, such as bankruptcy filings or collection accounts, on your report. Your excellent score means you can qualify for the best deals available.

Very Good

Your credit score is between 750 and 800 and you are considered a very low credit risk. You use your credit accounts responsibly and pay your accounts on time each month. Your credit score qualifies you for some of the lowest rates available.

Good

Your credit score is between 700 and 750. Lenders and insurance companies view you as a low credit risk. You may have had late payments in the past, but all of your accounts are currently paid on time. You also do not have an excessive amount of credit card debt. Your credit score qualifies you for very competitive interest rates and terms, but maybe not the best that a lender has to offer.

Fair

Your credit score is between 650 and 700. You are considered to be a moderate credit risk. You may have older derogatory items on your credit report that are not hurting your score as much as they used to. Your fair credit score could also be the result of higher than normal credit card debt or too many applications for new credit in the past few months.

Bad

Your credit score is between 600 and 650. Lenders and insurance companies will view you as being a high risk. Scores below 650 are considered “subprime” by many lenders. Your credit score could be lower than average because of high amounts of credit card debt or derogatory items on your credit report, such as late payments, collections, or even bankruptcy. Your credit score makes it difficult to be approved for standard credit products at competitive rates and terms. It’s also possible that you could be denied for credit or insurance.

Very Bad

Your credit score is below 600. This means that you are a very high credit risk. Mainstream lenders and insurance companies are not likely to approve your applications. If you are approved, you will be charged much higher interest rates or premiums. Credit scores below 600 are usually caused by late payments, collection accounts, or public records appearing on your credit reports. Excessive applications for new credit or high amounts of credit card debt can also lower your score. It will be difficult for you to obtain new credit without the help of a co-signer or a large down payment.

No Credit

You have no credit score. Lenders and insurers cannot accurately predict your credit risk and by default they consider you to be a high risk. Having no credit is better than having very bad credit, however, and you can be approved for new accounts. You probably have not been using credit cards and loans regularly enough for there to be recent information on your credit reports. You may be trying to open your first account, or you simply have not used any type of credit recently. You can establish your credit by opening a new credit card and using it responsibly. After a few months of use, your credit report should be able to be scored.

Using this criterion should help you in interpreting your credit report.

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