Is a credit score of 617 good?

Is a Credit Score of 617 Good?

When it comes to understanding credit scores, we often find ourselves wondering, "Is my credit score good enough?" For millions of people, the mystique surrounding credit scores remains a significant concern. It’s essential to demystify this concept and provide helpful insights to make informed financial decisions.

First Let’s Define What a Credit Score Is

A credit score is three-digit number that represents a person’s creditworthiness, calculated based on credit reports from different credit reporting agencies, most notably Equifax and Experian. The most common credit score used is FICO, which ranges from 300 to 850, with higher scores indicating improved credit health.

Determining the Goodness of a Credit Score: Why 617 is Considerably Better than Average

Coming back to the question – is a credit score of 617 good? Absolutely! 617 is no longer considered poor or unhealthy, but rather, on the cusp of fair to very good territory.

Credit scores are categorized into categories, with the most standard being:

Good Credit Score Range
High: 750 and Above
Very Good: 700-749
Good: 670-699
Average: 620-659
Fair: Below 620

With this context, a 617 credit score falls safely within the average to good range, but just barely. Here is why:

  • 619 is the threshold : A score of 610 or lower is generally characterized as fair risk, while 620-plus is considered good or very good risk depending on other factors. Even with a 617 credit score, you are, on average, only several points away from entering the good category.

    • Payment history influence: Payment history influences 35% of your credit score. So, if you’ve regularly made on-time payments recently, this could contribute slightly to your score’s climb towards the good zone.
    • Credit utilization ratio matters, too: Credit usage accounts for 30% of your score calculation. If you have the means to reduce your loan-to-limit ratio or revolving debt, this could marginally improve your score
  • Credit age may not be a major asset: Credit age also affects 15% of your score. Not having an extensive credit history (or having relatively ‘young’ accounts) within this range may impact some aspects of your credit-worthiness.

Next Steps: How to Gradually Improve Your Credit Score

While a credit score of 617 is undeniably better than nothing, there’s always the opportunity to improve and strive for a higher credit benchmark. Here are some time-tested strategies to slowly yet steadily increase your trustworthiness:

  1. Pay your bills right on time: Payment History is crucial. Avoid negative marks by paying at minimum the minimum payment each bill on or before the dues date.
  2. Monitor **Credit Utilization Ratios**

    .

Credit Utilization Ratios
<55%: Good Above 30%: Debatable
30-49%, OK Above 64%: Poor

  1. Don’t pursue excessive credit: Be intentional about applying for credit services, as excessive inquiries trigger temporary score drops. Practice responsible borrowing and manage ‘soft inquiries’ through:

    • Soft Checks: Pre-approach checks for credit or card applications
    • Authorized user requests
      • Credit card applications
  2. Build a credit-positive habit: Regularly take small steps towards better long-term credit habits. With patience and persistence, any small improvements will reflect incrementally in your score with time.

Conclusion – Is a Credit Score of 617 Good? Summary

In conclusion, whether a credit score of 617 is good becomes clear: Yes, it is! Your number is not only respectable among credit scores but also highlights a strong foundation for achieving good credit status when fine-tuned.

Given the factors mentioned above, consider tackling areas like payment history adjustments, credit utilization, aged credit, and the monitoring of credit inquiries to unlock a higher credit score!

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