Is 516 a good FICO Score? Is 516 a bad FICO Score?
Is a FICO Score of 516 good? Is a FICO Score of 516 bad?
What does a FICO Score of 516 mean? What does a 516 FICO Score mean?
What does a TransUnion FICO score of 516 mean? What does an Experian FICO score of 516 mean? What does a Equifax FICO score of 516 mean?
Different ways of asking the same question! However, you must understand how a FICO score is calculated before you can label a particular number as “good” or “bad”.
A credit score, also known as a FICO Score is a number that summarizes your credit risk, based on a snapshot of your credit report at a particular point in time. A credit score helps lenders evaluate your credit report and estimate your credit risk. The most widely used credit scores are FICO scores, the credit scores created by Fair Isaac Corporation.
What Makes Up a Credit Score?
Your FICO score is essentially made up of the following:
* Payment History – 35%
* Total Amounts Owed – 30%
* Length of Credit History – 15%
* New Credit – 10%
* Type of Credit in Use – 10%
How can I Rank My Score?
Scores are assigned a numeric value of between 300 and 850. Here is the general scale and what the scores may mean:
700 and above: Excellent / Very Good Credit. You are considered a low credit risk by institutions and would generally qualify for the lowest interest rates and repayment terms.
680 -699: Good Credit. You will usually be approved for loans with favorable terms.
620-679: Reasonable Credit. You are a moderate credit risk, and while you won’t usually be refused credit, you will not be able to borrow at the best rates.
550-619: Poor credit. You may have to shop around to find a lender willing to approve an application for you, and your loans will be quite expensive.
below 550: Very bad credit. You are considered a high risk customer and will have difficulty finding lenders. You will have to look seriously at some strategy of ‘credit repair’.