Consistently paying bills on time can increase an individual’s credit score, higher Credit Scores can mean lower interest rates on loans and credit cards. Keeping balances close to account limits can also lower a person’s Credit Score. Checking your own Credit Report will not lower your Credit Score.
Here is a breakdown of credit scores and what categories they generally fall into.
Low Risk (726 – 830): Lenders rest easier when they extend loans and credit to individuals with high Credit Scores. Plus, you may be able to save money by negotiating a lower interest rate or a better term on a new loan or credit card.
Low – Medium Risk (700 – 725): Lenders may be more willing to extend credit to individuals with Credit Scores in the low-to-medium risk range. In this range, you may get better-than-average rates and terms on new loans and credit cards.
Medium Risk (626 – 699): Lenders may still be willing to extend loans and credit to individuals with mid-range Credit Scores; however, you may only get average rates and terms.
Medium – High Risk (551 – 625): Lenders may be less willing to extend credit to individuals with Credit Scores in the medium-to-high risk range. In this range, you may not enjoy the best rates possible.
High Risk (330 – 550): Lenders may be wary about extending loans and credit to individuals with Credit Scores in the high-risk range. You may be denied credit, or pay higher rates.