Credit Score — Financial Glossary
Definition: A numerical rating (300–850) that represents your creditworthiness based on your credit history.
What is a credit score?
A credit score is a three-digit number (typically 300–850) that lenders use to evaluate how likely you are to repay borrowed money. The most common scoring model is the FICO Score.
Score ranges
| Range | Rating |
|---|---|
| 800–850 | Exceptional |
| 740–799 | Very Good |
| 670–739 | Good |
| 580–669 | Fair |
| 300–579 | Poor |
What affects your score?
- Payment history (35%): On-time payments boost your score
- Amounts owed (30%): Lower credit utilization is better
- Length of credit history (15%): Longer is better
- Credit mix (10%): Variety of credit types helps
- New credit (10%): Too many inquiries can hurt