Is 680 a good credit score?

When you're ready to learn about credit scores, that's a good thing—it shows that you take your financial health seriously. 

What is a credit score? In simple terms, it's a three-digit number that tells you (and lenders) how you have managed your credit accounts and debts. 

Achieve looks at what a 680 credit score means for you and your money situation. 

Key takeaways:

• Credit scores are three-digit numbers that tell lenders how you manage credit and debt.
• A 680 credit score is considered good, according to the FICO credit scoring model.
• With a 680 credit score, you could get approved for personal loans, home equity loans, and other types of credit.

Credit scores, explained

Where do credit scores come from? It starts with your credit reports.

A credit report is a collection of details about your credit accounts. Your creditors, which are the companies you owe money to, report information about your debts to the credit bureaus. 

Those credit bureaus—Equifax, Experian, and TransUnion—compile that info into credit reports. Then, companies like FICO and VantageScore use the data from those reports to calculate your credit scores. 

FICO scores and VantageScores range from 300 to 850. A higher score is good; a lower score isn't so great. Creditors decide what scores to consider excellent, good, fair, or poor. Most would consider 680 a good credit score. 

What does a 680 credit score mean?

A 680 credit score means your score is near or slightly above the average score for the typical American. At least, that's what FICO says.

When you look at the range of credit scores, 680 is considered good credit. A 680 score isn't the highest, but it sends a signal to lenders that you’ve managed your accounts well in general. 

How does a credit score work when you apply for loans? Lenders use your score as a tool to decide whether to extend credit to you.  

• Borrowers with lower scores are usually seen as higher risk. That means the lender is less sure that you’ll pay back what you borrowed. 
• Borrowers with higher scores are lower risk. Lenders are more confident they'll get back what they lend. 

So what does that mean for you? 

A lower score could make it harder to get approved for credit when you need it. If you do get approved, you'll likely pay a higher interest rate compared to a borrower with a high score. That's how the lender offsets the risk.

If you have a 680 credit score (or higher), you'll typically find it easier to get approved for loans compared with someone who has a lower score. Also, many lenders offer lower interest rates to borrowers with higher scores, and that could save you money in the long run. 

Is 675 as good as 680? How much does it matter?

As far as FICO is concerned, there's no meaningful difference between a 675 credit score and a 680 score. Both scores still put you solidly in good credit territory. 

Will a lender make a fuss over a five-point difference? Only if the 680 is a cutoff point (or near one). If a lender’s minimum score for the next lower interest rate, for example, is 680, then coming up even one point short could hurt you. 

Every lender is different when it comes to how they decide who to lend to and how much to charge.

If you plan to apply for a loan or credit card, it helps to know where you stand credit-wise. That means checking your credit reports and scores to find out how you measure up and get ideas for where you can improve. In our example above, if you’re five points away from what you want, improving your credit standing before you apply is a challenge worth taking on.

What loans can you get with a 680 credit score? 

A 680 credit score could help you get approved for a range of credit options, which include:

• Personal loans. Personal loans are usually unsecured, which means there's no collateral tied to them. If approved, you can use a personal loan for practically any purpose, from debt consolidation to emergency expenses. 
• Home equity loans and lines of credit (HELOCs). A home equity loan or HELOC is a way to borrow against your home if you have enough home equity. Some of the most common uses for a HELOC include home improvements and repairs, debt consolidation, and large purchases. 
• Credit cards. Credit cards give you flexible spending power, and some pay you back with cash rewards, travel miles, or points. A 680 credit score may give you access to top-tier cards with valuable features and benefits. 

You could also qualify for a mortgage to buy a home, a cash-out refinance loan, car loans, and private student loans with a 680 credit score. 

Note that qualifying for a loan depends on more than just your credit score. 

What's next

• Get a free copy of your credit report from each of the credit bureaus at annualcreditreport.com and review them for any errors or mistakes. Some errors could affect your scores. 
• Check your credit scores to learn where you are on the 300 to 850 scale.  
• Sign up for free credit monitoring to stay on top of changes to your credit reports that could affect your scores. 

This story was produced by Achieve and reviewed and distributed by Stacker.