Is a 600 Credit Score Good or Bad?

A 600 credit score is good enough to give you access to many types of credit. At the same time, it also leaves room for improvement. A 600 just means that, like many of us, you have some negative information in your credit report. There are all kinds of reasons that can happen.

High credit card debt is a common factor that drags down credit scores. Choosing a debt relief strategy is one way to get on a path to a stronger credit profile.

Learning about credit scores and where a 600 credit score fits in can help you understand your options. It can also point towards possible ways to improve that score and open up additional options. 

Taking control of your credit score is one of the best things you can do to empower yourself financially.

What Does it Mean if You Have a 600 Credit Score?

In general, a 600 credit score is high enough that you could apply for popular forms of credit like a mortgage, auto loan, or credit card. Improving your credit score—which may be easier than you think—could open the door to more options and better credit terms (translation=cheaper). 

A credit score is a number based on a formula designed to show how risky it is to lend you money. It reflects your past experience with credit accounts, and how you’re using credit now. If you apply for a mortgage, auto loan, or credit card, your credit score is likely to come into play. Lenders not only use it to decide whether to approve your application. They also rely on credit scores to determine how much to lend you and what interest rate to charge.

Landlords might consider it when deciding whether to rent to you.

A 600 credit score is not in the lowest tier of credit scores. It can be good enough for many situations. However, it’s also not in the highest tiers of credit scores, and that gives you room to grow. 

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What Are Credit Tiers?

There are many kinds of credit scores, but the FICO® credit score is probably the most well-known. A FICO score is a three-digit number that lenders use to decide whether you’re a risky borrower. It’s based on information in your credit report.

FICO scores range from 300 to 850. Lenders recognize that credit scores don’t precisely pinpoint which consumers are better users of credit than others. For example, a person with a 595 score isn’t necessarily a better credit customer than someone with a 585 score. So generally speaking, they separate credit scores into broad tiers that give a general feel for where scores stand. 

Each lender decides what credit scores to include in each range. Here’s how the tiers could break down:

Under this classification system, a 600 score is neither good nor bad. There’s room to move up to a higher credit tier, but in many cases a 600 credit score is good enough to get you common types of credit.

What Does a 600 Credit Score Get You?

Credit conditions vary, so sometimes it’s easier to get credit than at other times. In general, a 600 credit score could qualify you for an auto loan, mortgage, or credit card. 

Is 600 a good credit score to buy a car?

Yes, you could buy a car. But you probably won’t qualify for the advertised specials you see in ads.

The Household Debt and Credit Report from the Federal Reserve Bank of New York shows that year after year, over $100 billion in auto loans are made to people with credit scores below 620. Knowing this should give you the confidence to shop around for a car loan. 

Is 600 a good credit score to buy a house?

Yes, you could get a mortgage with a 600 credit score. In particular, there are government programs designed to make mortgages available to people with a credit score in this range. 

• FHA loans are insured by the Federal Housing Administration. This insurance gives mortgage companies a financial safety net that lets them lend to people with lower credit scores. The minimum credit score for an FHA mortgage is 500.

• USDA loans are insured by the U.S. Department of Agriculture. USDA loans are for low-income and moderate-income borrowers buying an eligible home (usually in a rural area). The program has no minimum credit score, but individual lenders may require a 580 to 620.

If you have a 600 or similar credit score, your best bet may be to start by seeing if you qualify for one of the above types of mortgage.

Is 600 a good credit score to get a credit card?

According to data from the Consumer Financial Protection Bureau, there are dozens of credit cards offered to people with credit scores below 620, or even no credit score. 

If you have a 600 credit score, you might find credit card application denial less likely if you apply for a secured credit card. That’s a card that requires you to keep a deposit with the credit card issuer as collateral. However, there are also several unsecured credit cards marketed to people in this credit score range.

How You Might Benefit from Improving Your 600 Credit Score

There are plenty of credit opportunities available to people with a 600 credit score. Still, you might benefit from raising that credit score. The higher your credit score, the greater your chances of getting approved for credit. That can open up more choices.

In addition, a higher credit score may qualify you for better credit terms. These may include lower interest rates, fewer fees, or a lower down payment.

5 Ways to Improve Your 600 Credit Score

If you’re interested in improving your credit score, here are five things to try:

1. Fix errors in your credit report. You can get free credit reports from the three major credit bureaus (Equifax, Experian, and TransUnion). You should check these periodically for inaccurate or outdated information. Contact the credit bureau if you find information that needs to be corrected. 

2. Pay down your debt. One factor that goes into a credit score is your current credit use. This includes how much you owe, and what percentage of your revolving credit you currently use. Paying down debt usually helps your credit score. This is especially true if you have high credit card balances.

3. Make payments on time. Payment history is the single most important factor in determining a credit score. So a consistent track record of on-time payments is essential to having a good credit score. Use credit regularly, and consistently make your payments on time to build a good credit history. 

4. Avoid applying for new credit accounts. Having too many new credit accounts can hurt your credit score. Even applying for too many accounts can harm your score. Choose carefully—don’t just jump at any new credit offer that sounds tempting.

5. Choose the right kind of credit. There are two types of credit accounts. Credit with a set schedule of payments, like a mortgage or a car loan, is called installment debt. Credit where borrowing and payments are more variable, like with a credit card, is called revolving debt. Having a balance between installment and revolving debts helps your credit score. 

A 600 credit score represents two types of opportunities. It gives you the opportunity to get credit now. It also gives you room to improve your credit score to qualify for better credit terms in future. Use your judgment to make the best use of both these opportunities.