580 credit score: A guide to credit scores
Quick insights
- A 580 credit score is considered fair by FICO® and subprime by VantageScore® scoring models.
- Lower credit scores can mean higher risk for lenders, potentially making it more difficult to get approved for credit products.
- To improve a 580 credit score, you can practice responsible credit behaviors like reducing debt, making timely payments and fixing any errors in your credit report.
Credit scores typically range from 300 to 850, with higher scores indicating better creditworthiness. A 580 credit score is toward the lower end of the ranges, potentially making it more difficult to get approved for credit or qualifying for the most favorable terms.
What else should you know about a 580 credit score? Let’s find out.
Understanding a 580 credit score
Credit scores are three-digit numbers that give an idea of borrowers’ creditworthiness. Lenders review credit scores when making lending decisions, like who to borrow money to and according to what terms and conditions.
A 580 credit score may be due to some negative factors like late payments, higher credit utilization or recent negative credit events. Understanding the specific elements impacting your score can help you in creating a plan for improvement.
Is 580 a good credit score?
A 580 credit score is not considered good according to the following credit scoring models. A 580 score is considered fair by FICO and subprime by VantageScore.
VantageScore's scoring ranges for VantageScore 3 are:
- Superprime: 781 to 850
- Prime: 661 to 780
- Near prime: 601 to 660
- Subprime: 300 to 600
FICO's credit score ranges for FICO Score 8 are categorized like this:
- Exceptional: 800 to 850
- Very good: 740 to 799
- Good: 670 to 739
- Fair: 580 to 669
- Poor: 300 to 579
Lenders may view a 580 credit score as a higher risk, potentially leading to less favorable terms, such as higher interest rates or a shorter repayment period. You might also face stricter approval requirements.
Improving your credit score can open up more opportunities for financial products and more favorable terms.
Chances of approval with a 580 credit score
Your chances of approval for credit products like a credit card or loan depend on various factors, including:
- The type of credit you're applying for
- Your income
- Your credit utilization ratio
- Your debt-to-income ratio
- Your payment history
To help increase your chances of approval, you could try applying for credit cards or loans that are made for people with lower credit scores. Some lenders specialize in offering credit products to people with lower credit scores. But keep in mind that these products may come with higher interest rates or fees. It can be helpful to review the terms and conditions before agreeing to anything.
How to improve a 580 credit score
How do you improve your credit from 580? Here are some tips to get you started:
- Make your payments on time: This is an important one, as payment history is an important factor making up your credit score.
- Review your credit reports: This allows you to check for errors and dispute any inaccuracies that could be negatively affecting your credit.
- Lower your credit utilization ratio: You can do this by paying down existing debts and balances. A credit utilization ratio of 30% or below is generally favorable.
- Avoid applying for new credit unless necessary: This matters because hard credit checks can temporarily lower your credit score.
- Consider keeping old credit accounts open: This may help lengthen your average account age, which is another factor considered when calculating your credit score.
- Monitor your credit: Keeping an eye on your credit score can help you to track your progress and be proactive. Using a free credit monitoring tool like Chase Credit Journey® can help you to monitor your credit and get updates about your credit.
Improving your credit score is possible, but it takes time and responsible behavior.
Conclusion
Having a 580 credit score can come with some challenges, such as limited credit access or qualifying for less favorable loan terms and interest rates. Understanding your credit score can help you make more informed decisions in the future.
Improvement is possible with dedication and consistency. By taking proactive steps—like paying bills on time, reducing your credit utilization and regularly checking your credit report for errors—you can gradually enhance your score.
