Equifax Credit Score: How to Check, Importance & Benefits

What is Equifax Credit Score?

What is Good and Bad Equifax Credit Score?

Credit information companies have individual systems of credit scores, and an Equifax credit score ranges from 300 to 900, with 900 being the highest possible score. Generally, a score above 700 is considered good.

Equifax score

Category

How did you get this score?

NH

No History

You do not have a credit history as you have not used a credit card or have never taken a loan

300-549

Poor

You have missed repayments or defaulted on credit card bills or EMIs, You will be considered a high risk, and will find it difficult to get a loan or a credit card.

550-649

Fair

You have some irregularities like late payments of bills/EMIs or multiple credit inquiries, Some lenders will consider approving your credit applications, but your interest rates might be higher

650-749

Good

You have been regular with your credit payments, and had responsible credit behaviour, Most lenders will consider your applications, but you may not get the best deals

750-900

Excellent

You have an exemplary credit history, with no defaulted on payments, utilization of credit, etc, You will be considered a low risk of turning into a defaulter, and banks and lending institutions will offer you better deals on loans and credit

Why is it Important to have a Good Equifax Credit Score?

How is a Person’s Equifax Credit Score Calculated?

A person’s Equifax score is calculated using a few major factors, such as:

Factors

What affects these factors

Payment history

The timely payments of credit card bills, loans, and EMIs, When payments are delayed or defaulted, it will lower your credit score.

Length of credit history

How long you have had a credit account, Older accounts and cards can reassure lenders that you have consistently been paying your bills on time.

Credit utilization

The amount of your credit limit that you use, Ideally one should spend no more than 30% of their credit limit; if it is higher than this, it can bring your score down.

Credit mix

Refers to the types of credit you have; there are two types: unsecured loans (like credit cards and personal loans) and secured loans (such as auto loans or home loans), It is recommended to have a mix of both.

New credit enquiries

The number of times you have applied for credit cards, loans, etc, A higher number of enquiries can bring your score down.

How to Check your Equifax Credit Score?

Frequently Asked Questions