Frequently Asked Questions(FAQ)

What is a good credit score?

What constitutes a good credit score depends on the credit scoring model being used. That said, FICO says a "good" credit score is any score between 670 and 739, whereas "very good" credit scores are 740 to 799 and "exceptional" scores are 800 to 850.

When it comes to the VantageScore credit scores, "good" scores fall between 661 and 780, whereas excellent scores are between 781 and 850.

What is credit utilization ratio, and why does it matter?

Your credit utilization ratio is a term used to describe how much debt you have in relation to your available credit limits. This ratio is represented as a percentage, and higher ratios can impact your credit in a negative way.

If someone owes $3,000 on a few credit cards with total available credit limits of $10,000, this means their total credit utilization ratio is 30%. If they owe $6,000 on total limits of $10,000, however, their ratio is 60%.

What are the best ways to improve your credit?

Improve your credit by paying bills on time, keeping debt levels low, and refraining from opening or closing accounts unless you have to. If you follow these steps for several months or years, your credit score should see a boost over time.

Does checking your credit score hurt your credit?

Checking your own credit score results in a soft pull on your credit reports, and this does not impact your credit scores. However, the hard inquiries lenders place on your credit reports when you apply for a loan can negatively impact your credit in the short-term.


About the Authors

Holly Johnson

Written by: Holly Johnson

Award-Winning Personal Finance Contributor

I’m a professional writer who is obsessed with money, travel, and budgeting.

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