What Is a Fair Credit Score?

Just what is a fair credit score? And is it good or bad?

The answer is that a fair credit score is right in the middle. With a fair credit score, your score lands you right between a poor credit score and a good score. And while it’s better than poor, it’s not good, and can cost you in higher interest rates and poorer terms for loans and credit cards you are approved for or not getting approved for loans or credit cards altogether.

And the gain or loss of a few points on your fair score can make a world of difference with your personal finances. Because when you have fair credit, but not good credit, you’re no longer considered a poor credit risk. And if you’re close to the poor mark, a few points can hurt.

Just What Is a Fair Credit Score Anyway?

Both the VantageScore 3.0 and many FICO score models use a credit score range of 300 to 850. For each model, 300 is the lowest credit score and 850 is the highest. Depending on the scoring model—and there are dozens out there—if your credit score is in the lower to middle 600s, it’s considered a fair credit score. The breakdown of scores for the VantageScore and FICO scoring models looks like this:

Table 1: Credit scores

VantageScore Score	VantageScore Rating	FICO Score	FICO Rating
750-850	Excellent	800-850	Exceptional
750-850	Excellent	740-799	Very Good
700-749	Good	670-739	Good
650-699	Fair	580-699	Fair
600-649	Poor
300-599	Bad	300-579	Very Poor

Learn more about VantageScore vs FICO.

Many Americans fall into the fair credit score category—in fact, so does America as a whole. According to the credit reporting agency Experian in its State of Credit: 2017 report, the nation’s average score, based on the VantageScore 3.0 model, was 675. On the flip side, the average FICO Score in April 2018 was 704, which is in the good range for FICO.

But this is about you. And if you’re reading this, chances are, your credit score is fair—in the range of 650 to 655 for a VantageScore Score or 580 to 699 for a FICO score.

If you don’t know where you stand, you can get a free Experian VantageScore score right here on Credit.com.

Why Is a Better Credit Score Important?

Lenders and credit card issuers your credit score to:

Determine the interest rate or annual percentage rate to charge you on a loan or new credit
Determine whether to approve you for a credit card, credit line or
Determine what credit limit to give you on a credit card whether to increase or lower a credit line or limit.

As far as credit score guidelines go, the lower your credit score, the less access you have to credit. Or you may qualify, but only at a higher interest rate or lower credit limit. With a fair credit score, you do have more and better options than with bad credit score, but not as good as you have when you improve your credit score to good or better.

Credit Options for Fair Credit

What can you get with a fair credit score? A lot, actually. With many mortgages, the minimum credit score required is 620. And with fair credit, you’ll qualify for an auto loan, so there’s no need to limit your car shopping to a “buy here, pay here” type of car lot.

The Federal Housing Administration (FHA) makes housing affordable in the United States, and part of its services include loans. These loans feature lower fees and interest rates in order to help those who are struggling to purchase homes.

To get an FHA loan, you need a minimum FICO score of 500, but that loan would come with a large down payment. A down payment of 10% may not be appealing, especially if you’re someone who struggles with finances. The minimum down payment is 3.5%. To qualify, your credit score must be 580 or higher. So, if you have a fair FICO score between 600 and 649, you can qualify for an FHA loan.

There are also credit cards you can qualify for with a fair credit score—although cards with the lowest annual percentage rates (APRs) may be out of your reach. Rewards cards are even available and some offer low annual fees.

To find credit cards suited to your fair credit score, sign up to see your credit score for free on Credit.com. Credit.com is the only place—other than Experian itself—where you can get your Experian credit score. And on Credit.com, your score includes a free credit report card that summarizes your credit report information and the five factors that impact your score and how you can improve your credit by improving one or more factors.

Payment history—the biggest factor in determining your score. Your credit report card shows any missed and late payments as well as on-time, consistent payments.
Debt usage—or credit utilization ratio—which makes up a big chunk of your score. If your credit cards are all near their limits, this increases your ratio and therefor your card debt, which makes you a higher credit risk for lenders and issuers.
Credit age or credit history—a difficult to control factor that includes your oldest accounts and closed accounts.
Account mix—which matters because lenders like to see a combination of installment loans and revolving credit accounts—aka credit cards—on your credit file.
Credit inquiries—particularly a hard inquiry requests from lenders or card issuers also show up on your credit report and can hurt your score.

Loans for a Fair Credit Score

The higher your credit score, the lower your interest rate tends to be for loans and credit card offers. For those with excellent credit, credit card interest rates hover around 14%. Good credit scores give you access to cards with rates averaging around 20%. If you have a fair credit score, credit card rates of 22% are typical. There are many different credit cards you can apply for when you have fair credit.

If you want an auto loan, expect to pay between 6.5% and 12.9% in interest.¹ Raising your score to the good or excellent range might help you qualify for rates as low as 3.2%.¹

Additionally, interest rates for mortgages increase as your credit score decreases. A good FICO score credit score of 670 to 739 qualifies someone for a mortgage annual percentage rate (APR) between 4.47% and 4.08%.² Higher FICO score credit scores help people qualify for low-interest-rate mortgages of as little as 3.86%.²

Improving Your Fair Credit Score

Because payment history accounts for 35% of your credit score, making steady, on-time payments on a mortgage, auto loan or credit card helps lift your score over time. Missing a payment or paying late will leave you further from your goal of reaching a good credit rating.

Besides payment history, there are other credit scoring factors you can focus on to improve your fair score. Think of your credit history.

Have you opened a bunch of store credit cards recently? The deals might seem enticing, but having so many credit cards may raise red flags and lower your score. A 10% discount at a store sounds good in theory, but dropping your score by just a few points may be what’s keeping you from having a good credit score—or worse, push you into poor or bad credit territory.

The ages of your different accounts also affect your overall credit score. If you’re new to credit, it’s likely your young credit age is keeping your score lower than it will be eventually. There’s not much to do besides waiting it out, but know that keeping a few accounts open for a long time gradually benefits your credit score, and it may make the difference that launches you into the good credit tier.

Keeping credit card balances low in relation to your credit limit also benefit your score. So, keep your purchases minimal and your payments steady on your credit cards, and you may see your credit score improve.

Find out more ways you can improve your score and get closer to your financial goals in the Credit.com Credit Reports and Scores resource center.

1 https://cars.usnews.com/cars-trucks/average-auto-loan-interest-rates. Note that rates change frequently. Rates in the article body are from early May 2019, and may have since changed.

2 https://www.myfico.com/loan-center/home-mortgage-rate-comparison/default.aspx