Credit Score
A three-digit number summarizing your creditworthiness, ranging from 300 to 850.
What is Credit Score?
A credit score is a numerical rating — typically between 300 and 850 — that lenders use to evaluate the risk of lending money to a borrower. The most widely used model is the FICO score, calculated by Fair Isaac Corporation. Scores above 740 are considered very good; below 580 is poor. Key factors include payment history (35%), amounts owed (30%), length of credit history (15%), credit mix (10%), and new credit inquiries (10%). Higher scores unlock lower interest rates and better loan terms.
Example
A borrower with a 760 credit score may qualify for a 30-year mortgage at 6.5%, while one with a 620 score might pay 8.0% — a 1.5% difference that adds hundreds of dollars per month on a $400,000 loan.
Source: Consumer Financial Protection Bureau — Credit Scores