‘Bad’ Credit Scores Are Officially Subprime, Fair, or Very Poor
Although “bad” is not one of them, there are certain words lenders and reporting agencies generally apply to specific credit score ranges, each of which has different implications for your ability to use credit to borrow money. There are two primary credit scoring models, FICO and VantageScore, and they both report scores from 300 to 850. Though they break down their ranges slightly differently, they’re closely aligned. Let’s focus on FICO, which is the older model and more widely used in lending decisions. The FICO Score ranges are:
- Exceptional: 800-850.
- Very Good: 740-799.
- Good: 670-739.
- Fair: 580-669.
- Very Poor: 300-579.
Americans’ average FICO credit score – which the Consumer Financial Protection Bureau (CFPB) calls “Prime” – was 710 in 2020 and falls in the “Good” range.1 When you hear “subprime” used to describe credit scores, it means below average. Lenders usually consider any score below the Good range as subprime and might anticipate that people with subprime scores may struggle to repay what they borrow.
So, you may consider it fair to call a subprime credit score bad. And according to the Experian credit reporting agency, approximately 34% of people have subprime FICO scores,2 which means they generally won’t get favorable interest rates and may not be able to borrow at all.