How Good is a Credit Score of 620?
June 20th, 2013 | Author: Stephanie
[W]hether you are using a standard scale such as FICO or a potential lender is using its own scale, you want your credit rating to be as high as possible. While a 620 is not a terrible credit rating, it is definitely not considered an ideal credit score especially for unsecured credit cards and personal loans. You’re going to want to do everything within your power to boost your credit score higher.
How good is 620 for a credit score when it comes to mortgages? You might not get denied, especially if you are applying through a government program. You will pay more in interest if your score is close to this range. Some mortgage companies will deny your request, especially if you do not have a large enough cash down payment. Lending representatives will be much more concerned with your income and assets than they would be if your score was 650
or better. You will probably have to buy a less expensive house than you would if your credit sore was above 620.
Insurance and utility companies might charge more money to conduct business with you. If you have recent unpaid collection accounts or late payments, then you will probably pay higher insurance premiums, even if your credit rating is 620 or better. Such delinquencies indicate that you are a potentially high financial risk. Utility companies will probably charge cash deposits to conduct business with you, especially if your credit rating was caused by derogatory circumstances such as missed loan payments or bankruptcy.
Time will heal your credit rating if it is the result of past irresponsibility or bad luck. If your 620 credit score is due to a high amount of debt, you can increase your creditworthiness by making larger payments on your credit card accounts. No matter what your credit score, do not apply for too many accounts as these applications can cause your creditworthiness to plummet.