How Good Is a Credit Score of 657?

FT Contributor
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A credit score of 657 ranks as “Fair,” according to FICO’s official classification of credit score ranges. Consumers with a Fair credit rating have already eclipsed minimum qualifications for “Very Poor” and credit scores. However, further improvements are required before borrowers will begin to see signs of a “Good” credit score.

Credit scores are used by lenders to determine a borrower’s creditworthiness — their ability to repay a loan once it has been issued. Five financial factors contribute to the equation that determines a borrower’s credit score:

  • Payment history;
  • Credit type;
  • Total debt;
  • New credit;
  • Credit age.

These influences on your credit score can mean the difference between streamlined loan applications and difficulty spending your money in the ways you want.

Borrowers looking for regular updates on recent credit score changes will often trust safe-for-use credit aggregation programs like AnnualCreditReport.com. Not a credit reporting service in itself, AnnualCreditReport.com collects credit reports from Experian, Equifax, and TransUnion in a single, convenient location.

Why Your Credit Score Is 657

While it isn’t possible to identify the exact reasons for a credit score of 657, typical influences on Fair credit scores include excessive hard inquiries, an inconsistent payment history, and a still-maturing credit age.

Excessive Hard Inquiries

Any time a lender officially considers a potential borrower for a new line of credit, a hard inquiry is performed.

Hard inquiries are standard examinations of a consumer’s financial history, to determine their level of fiscal responsibility and help a lender gauge risk. Individuals with credit scores of 657 can see their credit ratings negatively affected by excessive hard inquiries.

Hard inquiries can remain on financial records for up to a year. While one or two hard inquiries during that time are considered typical and will have an almost negligible effect on your credit score, excessive hard inquiries can indirectly lower your credit ranking.

Perhaps more importantly, too many hard inquiries in a short time can make it even harder for borrowers to secure new loans or new credit cards. After all, lenders will be understandably hesitant to offer new lines of credit to borrowers with multiple loans already active.

Inconsistent Payment History

As the primary factor in determining a borrower’s credit score, payment history accounts for 35% of the total credit score equation. Consumers with credit scores of 657 often have credit accounts characterized by inconsistent payment histories, containing a mixture of full and incomplete, as well as on-time and late, payments.

Increasing your credit score is sometimes as simple as improving your payment history. However, improvements that sound simple can be difficult to achieve in reality.

Individuals looking to improve a credit score of 657 through payment history will need to practice disciplined spending habits. This means avoiding impulse purchases, reserving fuller portions of monthly wages specifically to repay credit balances.

Restricting unnecessary spending and making full, on-time payments can go a long way toward future credit score increases.

Still-Maturing Credit Age

Credit age refers to the average age of all active lines of a borrower’s credit and is one of the factors that influence credit score changes.

Over time, natural increases in a consumer’s credit age can contribute to improvements. However, individuals with a 657 credit score commonly see their credit age compromised by frequent, new lines of credit.

Even though it can be tempting, opening new loans to repay old debts is harmful to a credit score in more ways than one. One negative consequence of excessive borrowing is the fact that credit never has a chance to mature.

Consumers who frequently open new lines of credit are constantly resetting the average of their overall credit. Individuals dedicated to improving a 657 credit score will look to minimize active credit lines, reducing hard inquiries and allowing credit age to naturally increase over time.

What Can You Do With a 657 Credit Score?

A Fair credit score of 657 means that borrowers often face challenges when attempting to secure new loans. When lenders do accept 657 credit scores, obtaining a new line of credit is often contingent on significant interest rates, lofty fees, and higher required credit repayments.

Reference the information below for more information on what borrowers with 657 credit scores can expect when pursuing common financial opportunities.

  • Personal loans allow borrowers to fund personal projects, whether that means a destination wedding or a home renovation.
  • Mortgage loans are also possible to secure with a credit score of 657.
    • Depending on the mortgage lender, consumers with Fair-ranking credit scores will often see their loan applications accepted alongside higher required interest rates and origination fees.
  • Rewards-based credit cards deliver incentives on a wide variety of transactions.
    • While a credit score of 657 isn’t sufficient to qualify for many of the best rewards-based credit cards — which perks like airline miles, restaurant points, and hotel rewards — you’ll still be able to secure a credit card that offers 0% introductory financing options and rewards from your favorite retail outlets.
  • Apartment rentals are usually possible to obtain with a credit score of 657.
    • Apartment managers commonly deal with Very Poor and Fair credit scores, meaning that your comparable credit rating is often sufficient to help you obtain an apartment rental — depending on the standards of your intended apartment community.

A credit score of 657 can make a new loan, new credit card, or new line of credit more difficult to obtain. Borrowers with Fair credit scores should consider lenders who offer loans for bad credit, whenever immediate financing is a priority.

How to Repair a Credit Score

When repairing a credit score of 657, borrowers should first prioritize more serious risks to long-term financial stability. Namely, consumers should take steps to protect credit accounts against loans in default, payments owed to collections agencies, and even bankruptcy.

Beyond risk avoidance, individuals with 657 credit scores should look to replace irresponsible fiscal habits with financially minded practices. This means making complete, on-time payments toward credit balances, lowering total debt without the need for any new lines of credit.

If you ever notice errors in a credit report, it’s time to take action before credit report inaccuracies result in decreases to your overall credit ranking. The best credit repair agencies can offer guaranteed credit score improvements, and will even mitigate concerns by communicating directly with credit companies and lenders.

Correcting and cleaning a credit report is a great first step toward future credit score improvements.


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