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Do All Credit Scores Have To Be Perfect?

8 November 2020 No Comment

Understanding your credit score can be a time-consuming process, especially as so many lenders use several different ranges to determine a poor credit score. However, it is possible to determine whether your credit score is positive or negative and begin to improve this in the near future. In this article, we will be providing you with some insight into whether or not your negative credit score will affect your ability to be accepted for loans.

How To Determine A Poor Credit Score?

When looking to apply for alternative finance you should start by checking your credit score. With several credit score checkers out there; this should be your first port of call. But what is the threshold for a poor credit score? Most credit score lenders use the FISCO scale when checking credit scores to determine what a poor credit loan is and what isn’t. To help you understand your credit score, we have the scale below:

FICO® Score Ranges

How Can It Impact You When Applying For A Loan? 

Should you check your credit score and find that you’re in the poor to fair category this can have an impact on your ability to be accepted for certain types of loans. With several different loan types out there, several loans can cater to every financial status. With options such as a bad credit loan allowing those with poor credit to apply for alternative finance, it is still possible to get their finances. Though these poor credit loans have many benefits, they also have their own challenges such as a higher interest rate when compared to applying for good credit loans.

Loan Types For Poor Credit

When you are dealing with poor credit, it is important to be aware of the different loan options available to you. Not only are their poor credit loans, but there are also other loans types such as guarantor loans that require the signature of a family member to make sure that the loan payments are being made even if you miss them.

How To Set About Improving Your Credit Score?

Though it may seem like an impossible task, it is important to make sure that you set a plan on how to improve your credit score. Whether you check the information to look for any mistakes or you take time to begin paying off any outstanding debts that you have. This will benefit you over time as it will positively improve your business providing long-term results in the form of a positive credit score at this time. Though it can take time to begin seeing these results, it will benefit you in the long term.

With this in mind, there are several ways that you can continue to better your credit score and boost your chances of being accepted for alternative finance in the near future.

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