The credit score is the number that helps lenders such as banks, credit unions… decide what types of loans to offer to people. The credit scores are created by computers that scan through your credit reports. Today Info Credit Free introduces to readers some WAYS to people can check credit rating in order to get loans.

Check credit rating
Some WAYS to people can check credit rating in order to get loans

In the previous articles, the readers of Info Credit Free are understood properly about some loans such as bad credit loans, low-interest personal loans, online loans for bad credit … Now, let’s see “Some WAYS to people can check credit rating in order to get loans”

CHECK CREDIT RATING

This our post includes the main three parts which are: “What is the credit rating?”, “How many kinds of credit rating are there” and “How to check the FICO credit score for free?”.

1. What is the credit rating?

Credit rating are number that third parties, especially lenders such as banks, credit unions and other institutions use to assess the risk of lending you money. 

In the United States, The FICO score is the credit scoring system you will hear about most. FICO score will be between 300 and 850 and a higher score is better than a lower score.

The FICO score is broken up into five major factors, includes:

  • 35% Payment History 
  • 30% Amounts Owed
  • 15% Length of Credit
  • 10% New Credit 
  • 10% Type of Credit

2. How many kinds of credit rating scores are there?

Based on the FICO score, the categories of credit scores are as follows:

2.1. Exceptional Credit Rating: 800 to 850

If you have a credit score in the range of 800 to 850, you will be considered consistently responsible when it comes to managing your borrowing. And you are the prime candidate to qualify for the lowest interest rates.

There are some habits people exceptional credit score tend to have in common, such as:

  • They got their financial act together early
  • They rarely close credit cards
  • They budget everything
  • They avoid credit checks
  • They don’t use most of their credit
  • They’re obsessed with their finances

2.2. Very Good Credit Rating: 740 to 799

If your credit score between 740 and 799, you are generally financially responsible when it comes to money and credit management.

2.3. Good Credit Rating: 670 to 739

When you have a credit score between 670 and 739 which near the average of United State consumers (because the national average FICO score is 695), you can easily get personal loans with this score.

2.4. Fair Credit Rating: 580 to 669

People with credit scores ranging from 580 to 669 may have some problems with their credit history. They are still likely to be considered to get some loans by lenders such as credit unions or other institutions, but not at very competitive rates (high-interest loans).

Check credit rating
Some WAYS to people can check credit rating in order to get loans

2.5. Very Poor Credit Rating: Under 580

If you have a score between 300 and 579, you have a damaged credit history. Therefore, you have very little chance of getting new credit or loans.

2.6. No Credit

If you have a very low credit score (say, under 350), you haven’t yet established a credit score and don’t have a credit history. Let’s talk to your local lender about their borrowing requirements.

If I want a 48-month, $15,000 auto loan, here’s how the numbers shake out:

FICO Score Interest Rate Monthly Payment Total Interest Paid
720 and above 3.07% $332 $959
690-719 4.292% $341 $1,351
660-689 6.049% $353 $1,925
620-659 9.598% $378 $3,122
590-619 15.177% $419 $5,103
500-589 16.909% $432 $5,742

3. How to check the FICO credit rating for free?

There are more and more financial institutions offering free FICO scores. Here’s a list of several banks offering the free score:

  • Citibank
  • Discover
  • Barclaycard
  • Bank of America

If you are looking for loans which meet your need, you can click into articles, such as personal loans for people with bad credit, low-interest personal loans, small loans for bad credit…