What counts as a good or bad score

Your credit score is a three-digit number. Most scores run from 300 to 850. The higher the number, the better. But what do those numbers actually mean in real life?

Here is a simple way to think about the ranges.

300 to 579 — Poor This range is sometimes called "bad credit" or "deep subprime." A score here can make it harder to get approved for loans or credit cards. If you do get approved, the costs are often higher. This is a starting point, not a life sentence.

580 to 669 — Fair This range is also called "near-prime" or "subprime." You may qualify for some credit products, but you might not get the best terms. Many people work their way up from here with a little time and consistency.

670 to 739 — Good Lenders generally see this range as solid. You have more options and may start to see better offers. Getting here is a real achievement worth celebrating.

740 to 799 — Very Good At this level, lenders view you as a low-risk borrower. You are likely to qualify for better rates and terms on things like car loans or apartment rentals.

800 to 850 — Exceptional This is the top tier. Scores here open the most doors and tend to come with the most favorable terms available.

So what moves your score up or down? A few big things matter most. Paying bills on time is the single most important factor. How much of your available credit you are using also plays a big role. Keeping that number below 30 percent helps. Opening too many new accounts at once can pull your score down temporarily.

If your score is in the poor or fair range right now, that is okay. Scores are not permanent. They change every month as new information comes in. Small, steady actions add up over time.

Even moving from 520 to 580 can open new options for you. And moving from 580 to 670 can open even more. Focus on one step at a time. Check your credit report for free at AnnualCreditReport.com so you know exactly where you stand. Knowing your number is the first step to improving it.