A good credit score gives you a decent opportunity with lenders since most generally don’t work with individuals with anything less than a good credit score. However, there has been confusion among the general populace about what makes a “good” credit score.
There are several categories of customers concerning their FICO credit scores. There are exceptional users, very good users, good users, fair users, and very poor users. For access to as many utilities as the average American, it’s best to have a good credit score.
That explains why most people ask if their current credit score falls into the good category. In this article, I’ll answer the question: is 656 a good credit score? Also, you’ll learn some strategies to improve your credit score since it’s never bad to go higher.
Is 656 a Good Credit Score?
Americans’ average FICO credit score is 711, which is way above the 656 scores in question. Since the “good” score usually leans towards the standard, it’s obvious that 656 doesn’t qualify as a good credit score, at least not right now.
To make a good credit score, your score must be 670 to 739, which isn’t a far cry from your 656 scores. Getting to the good credit score range comes with many perks, making it necessary to improve your credit score actively.
Also, 70% of American customers have credit scores exceeding 656, which should inspire you to improve yours. If you’re unsure how to do that, don’t fret; subsequent sections in this article will detail the steps required to improve your credit score way past the dreaded “fair” range.
Before that, however, it’s crucial to learn if a 656 credit score is manageable. This article will analyze your loan and credit card options with a fair credit score to see if you can get by as you try to make a good credit score.
What Credits Card Can You Get with a 656 Credit Score?
People generally shoot for good credit scores, regardless of whether they need it to meet their goals. In addition to “is 656 a good credit score?” another question you should consider is what credit cards you can get with a fair score.
A credit score of that range gives you access to several unsecured credit cards, but certainly not as much as a good credit score. You should note that your credit limit will be relatively low compared to others with good, very good, or outstanding credit scores.
However, you should note that finding good rewards for credit cards typically requires good credit scores. While you may qualify for certain cashback with low credit scores, you shouldn’t hope for anything as good as what people get with better scores.
MORE READ: What Credit Score Do You Start With?
How to Improve a 656 Credit Score
With the limitations associated with having a fair credit score, it’s evident that your credit score needs improvement. Since the next step after an acceptable credit score is a good one, it seems like a reasonable goal to set.
Here are some practices that could improve your credit score from merely fair to good, and if sustained over a long time, could get you a very good and eventually exceptional credit score.
- Always Pay on Time
One of the worst things you can do to your credit score is paying your bills untimely. To gain the trust of lenders and show them that you’re worthy of a good credit score, it’s essential to ensure that you always settle your bills on time.
Having a decent payment history is key to getting a better credit score. It’s best to avoid worrying about the ones you’ve already fallen short of; focus on improving your repayment speed for future borrowings. You’ll start seeing a dramatic increase in your credit score.
- Reduce Your Utilization Rate
Another way to get better credit scores is to lower your credit utilization rate, which is generally seen as a positive thing when it comes to credits. Your credit utilization rate is a term used to refer to the percentage of your total available credit that you’re using.
If you’ve already owed $700 from a credit card limit of $1,000, your utilization rate is 70%. A 70% utilization rate is extremely high and will certainly impact your credit scores; try to keep your utilization rate closer to around 30% to improve your credit score.
There are several ways to lower your credit utilization rate. You can start by paying your existing debt without accruing more debt. Alternatively, you can ask your lender to increase your credit limit, automatically decreasing your utilization rate without impacting your total debt amount.
The average utilization rate for customers with a 656 credit score is 63% to get an idea of how low you should aim for. Lowering that to around 30% should be significant enough to change your fair credit score positively.
- Dispute Negative Information
Another way to better your credit score is to weed out inconsistencies in your credit report. It would help if you only tried to dispute information that affects your credit score negatively since changing them could only make positive changes to your score.
Depending on the credit bureau, you can dispute negative (and incorrect) information on your credit report by sending an email or a letter. Before making the report, ensure you have all necessary proofs and identification ready to make the process seamless.
If your credit score is at the 656 mark, it’s only natural to ask: “is 656 a good credit score?” In this article, I’ve answered the question using the official FICO ratings for credit scores, and if you’re curious, a 656 credit score is unfortunately not good.
However, you don’t have to lose sleep over it since you can always improve your credit score. This article details some of the best strategies to improve your credit score easily.