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The three major credit bureaus, Equifax, Experian, and TransUnion, consider 670 – 739 to be in the good range. It won’t hinder you from being approved for most credit cards or mortgages, but it also won’t get you the most favorable terms. This article will help you better understand the different credit score ranges, give you strategies to maintain and improve your credit score, and more.
- 670 qualifies as a good credit score
- A credit score of 670 will provide you with certain benefits, like lower interest rates
- There are proven strategies to improve your credit score
- If your credit score drops, there are remedial steps you can take
What Will a 670 Credit Score Get You?
If you compare the range of credit scores to a ladder, a good credit score of 670 is equivalent to being on the second rung from the top. It’s lower than the “very good” and “excellent” ranges, which will provide more benefits, but a 670 has its advantages.
- You will get a better interest rate. Credit card issuers, banks, and mortgage companies will offer you more competitive interest rates if you have a good credit score, like 670. This can save you hundreds of dollars annually by reducing the interest you pay on credit and loans.
- You can borrow more money. Borrowers with good credit scores typically have no problem qualifying for personal loans of $10,000 or more (see FinImpact’s review of 2023 best personal loans for good credit) and being approved for higher mortgage amounts and monthly payments.
- You can be approved for insurance easier. Insurance companies consider you a better risk if you have a good credit score, which will make the approval process go smoother for you and possibly get you a lower rate with the insurer.
- You’ll get more job offers. Many employers prefer hiring people with a 670 or higher credit score. They have proven they can handle their personal finances responsibly, making them more likely to be trusted with the company’s money.
Improving Your 670 Credit Score: Proven Strategies and Tips
Improving your credit score will take time, but it can be done by following some proven strategies and tips, including these:
- Check for errors on your credit report. Data input errors happen with every company, including those providing information about you to the credit bureaus. Check your credit report regularly and look for mistakes. If you see any, report them to the lender and the credit bureau. Lenders must correct these errors, which will improve your credit score.
- Lower your credit utilization rate. Your credit utilization rate is the percentage of the credit limit you’ve used with a particular creditor. For example, if you’ve used $5,000 of a $10,000 credit limit, your utilization rate is 50%. Lowering your utilization rates to 30% or less will help your overall credit score.
- Pay on time. Being 29 days late or more will lower your credit score more than any other factor. Lenders’ profit margins sink when borrowers are delinquent or skip payments entirely. Late payments can haunt you for as long as seven years. Do everything you can to pay on time. Contact your lender if you’re having difficulty and ask them to take late payments off your credit report after you’ve made them.
Regina is an excellent example of proactively contacting her lender when she fell behind on her student loan payment. She called the lender before they called her, worked out a lower monthly payment and got caught up in a couple of months. As a result, not only did she not get penalized, her credit score actually improved.
A 670 Credit Score vs. Other Credit Score Ranges
Knowing your credit score, the range it falls in, and where it stands compared to the other ranges will help you keep track of your score and see if your efforts to improve it are working. By moving into the higher ranges (very good, excellent), you’ll earn a better interest rate on credit cards and other loans (i.e., regular credit card interest rate of 18% to 20% compared to secured card rate of 26% to 36%).
800 to 850: Excellent
This is the highest you can climb up the credit score ladder. In this range, you’re considered very low-risk, and you’ll have a much easier time being approved for a credit card, personal loan, or mortgage. Lenders want to do business with people who are in this range.
740 to 799: Very Good
In this range, you’re seen as being credit-worthy, and you are in a position to request an increase in your credit limit or a lower interest rate. Having very good credit can give you additional leverage with lenders.
670 to 739: Good
This is the range where your 670 falls. By being here, you’ve shown you are responsibly handling credit, and you’ll have an easier time being approved for additional credit and loans.
580 to 669: Fair
This is not a preferred range for lenders and will have you categorized as “subprime.” Subprime means higher risk for lenders, which means you’ll be paying higher interest rates and approved for lower credit limits.
300 to 579: Poor
Being approved for new credit will take a lot of work. You may need to establish or re-establish your credit by applying for a secured credit card and bringing any past-due accounts current.
The Characteristics of People With a 670 Credit Score
Having a good credit score, like 670, means you probably:
- Have four or more credit cards
- Have a credit card balance of over $5,200
- Have an auto loan balance of $21,000
- Have a personal loan balance of $17,000
- Have a mortgage balance of $220,000
People with good credit scores also don’t max out their cards, make timely payments, and have a lengthier credit history than those with fair credit.
How to Maintain a Good Credit Score
If you have a good credit score and want to improve it over time, you’ll still need to concentrate on maintaining it. You can accomplish this by not only making payments on time, but also by:
- Leaving older, inactive accounts open. If you have one or more accounts listed on your credit report that you no longer use, don’t close those accounts. Leaving them open lengthens the average length of your credit history.
- Diversifying your credit mix. You’ll maintain and eventually improve your credit score if you have different types of credit on your report, including credit cards, personal loans, mortgage loans, and student loans.
- Reporting inaccuracies in your report. Maintain your score by checking your credit report regularly and catching errors early. Let lenders and credit bureaus know of any mistakes you’ve found, and be sure they’re removed promptly.
What to do If Your Credit Score Drops
If you notice your credit score has dropped, it may be due to a negative mark on your credit report, your credit limit was reduced, you’ve applied for multiple new credit accounts, or another reason. If that happens to you, take these steps:
- Pay past due balances. This is your first order of business if your score has dropped because of late or missed payments. Pay past due amounts and ask the creditor to show your account as current on your credit reports.
- Put your accounts on autopay. If you’re forgetting to make payments on time, set up your bills to be paid automatically on the same day each month. This will take some pressure off you and keep you from falling further behind.
- Look for errors and request they be corrected. All three credit bureaus have an area on their websites to report errors, which is the quickest way to fix them.
- Don’t apply for any new accounts. Submitting applications for new accounts and having hard credit pulls will only add to the problem, not fix it.
- Stop or limit using cards you have and lower the balances. If necessary, keep your spending under control, and leave your credit cards on the shelf while you reduce your balances. This should help stop the decline and eventually bring your score back to where it once was.
Organizations That Can Help With Credit Score Improvement
If you’re intent on improving your credit score, these are some links to sites and organizations that can help:
Fannie Mae: Besides helping lenders provide loans to prospective homeowners, Fannie Mae also offers valuable insights on their website to help consumers improve their credit and qualify for mortgages.
Debt.org: Educates consumers on things like credit cards, loans, credit scores, and more.
Experian Boost: A free service from the credit bureau Experian raises your FICO score instantly by getting you credit for services you already pay for, like utilities, video streaming services, and rent.
FTC Consumer Advice: A U.S. Government site providing consumers with financial advice, including obtaining and improving their credit score.
Lending Tree: A commercial website that offers consumer lending services and a credit improvement program with a free credit consultation.
Discover: Provides credit cards and helpful advice on the best ways to build credit.
A credit score of 670 is a good credit score that will help you be approved for all kinds of credit with competitive rates. You can maintain and improve your score by paying bills on time, watching your credit utilization rate, diversifying your credit mix, and checking your credit reports regularly to find and report errors. Following these steps will also help in the event your credit score drops.