What Is a Good Credit Score in the US?

Credit Score Basics: What the Numbers Mean

In the US, the most commonly used credit scores come from FICO and VantageScore. These range from 300 to 850. The higher your score, the more likely you are to be approved for credit with favorable terms.

Here’s a quick breakdown of what is a good credit score considered:

• 300 to 579 – Poor
• 580 to 669 – Fair
• 670 to 739 – Good
• 740 to 799 – Very Good
• 800 to 850 – Excellent

A score of 670 or higher is typically considered good. According to Experian, about 71% of Americans have a score in the good to excellent range. Lenders are more likely to approve borrowers with a score above 700, and those over 750 often receive the lowest rates.

Why Your Credit Score Matters

Lenders use credit scores to assess risk. Your score is calculated based on factors such as:

• Payment history (35%)
• Credit utilization (30%)
• Credit age (15%)
• Types of credit (10%)
• Recent inquiries (10%)

If you’re looking to secure favorable interest rates, especially for a mortgage or a personal loan, your credit score must reflect responsible financial behavior. A higher score can save you thousands over the life of a loan.

For more on how credit scores are calculated, check out Credit Karma.

How Credit Scores Affect Loan Offers

When applying for a personal loan, your credit score helps determine:

• Whether you’re approved
• The amount you can borrow
• The interest rate you’re offered
• The repayment term

For example, if your score is above 740, you might qualify for a loan with a 7% annual percentage rate (APR). If your score is in the 600s, the rate could climb to 20% or higher. This is why improving your score before applying is often a smart move.

Understanding Secured vs Unsecured Personal Loan

Once you know where your credit score stands, it’s time to think about the type of loan you might want. One key distinction is secured vs unsecured personal loan.

Secured Personal Loans

A secured loan requires collateral, such as a car, savings account, or certificate of deposit. Because the lender has an asset to fall back on, these loans tend to offer:

• Lower interest rates
• Higher loan limits
• Easier approval for borrowers with lower credit scores

However, the risk is that if you default on the loan, the lender can seize your collateral.

Bankrate provides a helpful breakdown comparing these two loan types in more detail.

Unsecured Personal Loans

Unsecured loans do not require collateral. Approval is based entirely on your credit score, income, and debt-to-income ratio. These are ideal for borrowers with good or excellent credit and provide more flexibility.

Pros include:

• No risk to personal assets
• Faster approval process
• Widely available through banks, credit unions, and online lenders

The downside is that interest rates are usually higher, especially for borrowers with fair or poor credit.

When a Secured Loan Might Make Sense

If you have a low credit score and you’re not seeing favorable loan offers, a secured loan could help you access funds at a reasonable rate. For example, some lenders offer credit-builder loans that are secured by a savings account, making them a good fit for improving your credit while borrowing.

Self Financial is a niche lender that specializes in this kind of secured credit-building product.

How to Improve Your Credit Score Before Applying

To access better loan options, consider taking the following steps:

1. Check your credit report regularly through AnnualCreditReport.com for any errors.
2. Pay down existing debts, especially credit card balances.
3. Avoid new credit inquiries right before applying for a major loan.
4. Set up autopay to avoid late payments.
5. Build a longer credit history by keeping old accounts open.

Consistency over time is the best way to increase your credit score, and even a 20-point improvement can make a big difference in your loan options.

Choosing the Right Loan for Your Score

Let’s say your credit score is 720. You could be eligible for an unsecured personal loan with competitive rates. If your score is closer to 600, consider a secured loan or a credit union, which may have more flexible criteria.

For example, many consumers turn to the Navy Federal Credit Union if they qualify through military service or family ties. Their personal loan rates are often lower than traditional banks.

How Lenders Use Credit Score Ranges

Different lenders have different criteria. For example:

• Traditional banks like Wells Fargo or Chase prefer applicants with scores above 700.
• Credit unions like Navy Federal or Alliant may accept applicants in the mid-600s with strong income and job history.
• Online lenders such as Upstart or Avant use AI-based underwriting that considers education and employment in addition to credit score.

The key is to shop around, compare multiple offers, and read the fine print.

Credit Score and Mortgage Approval

While this article focuses mainly on personal loans, it’s worth noting how your score affects mortgage lending. If you're wondering what is a good credit score to buy a house, most lenders look for at least 620 for conventional loans.

However, a score above 740 will get you the most favorable rates. Check out Rocket Mortgage for more details on how credit scores influence home loan approval.

Final Thoughts

So, what is a good credit score considered in the US? Generally, anything above 670 opens the door to better borrowing opportunities. If you’re applying for a loan, your score not only affects your interest rate but also helps you determine whether a secured vs unsecured personal loan is right for you.

Building good credit takes time, but with smart financial habits and the right lender, you can access personal loans that support your goals. Whether you're consolidating debt, covering a major expense, or planning for the future, knowing your credit standing will help you borrow responsibly and affordably.