Learn what credit cards you can get with a credit score of 359 and understant the things you can do to better your credit score.
A credit score is needed for you to be able to get a loan or credit. The reason behind this is because it will help financial institutions to determine your creditworthiness. They will also see every loan that you made and the payment history that you have. Find out more about it by reading the information below.
Credit scores are calculated based on the proprietary algorithm. This will include the person's outstanding debts, payment history, and the length of the individual's credit history.
Credit scores can range from 300 to 850. The higher the individual's score, the lower the risk. People who have lower credit scores are considered high risk, which will make lending companies ask for more requirements.
Credit cards you can get with a credit score of 359
Looking for credit cards with a credit score of 359 can be difficult because of the small credit score. The good news is, there are secured credit cards that you can get for yourself.
The best options for people with a credit score of 359 is to apply for a secured credit card. The reason behind this is because the bank will require you to deposit a certain amount, which will then be used as your credit limit. Here are some of the cards that you can get.
First Progress Platinum Elite
First Progress Platinum Elite does not require any credit score. You can apply and submit your application online. Once approved, you can deposit USD 200 to USD 2,000, which you can refund if you no longer need the card.
Citi Secured MasterCard
Citi Secured MasterCard will let you build your credit history. It has a USD 200 required deposit, but you can also add more to increase your limit.
About Fico scores
Fair Isaac Corporation is the one who established FICO, and it is one of the most commonly used credit scoring systems today.
According to FICO, 90% of the most reputable and respected lenders today are making decisions according to this kind of credit scoring system. Get to know more about Fico scores by reading the information below.
How are credit scores calculated?
The weight of each of the five categories are; 30% of amount owned, 10% is for the new credit, 15% accounts for the length of credit history, 10% is the credit mix and the last 35% accounts for the person's payment history.
The FICO score takes into consideration positive as well as negative aspects of the credit report. The percentage or the weight of any of the categories mentioned above may differ from a person to another depending upon the information available in the credit report.
The FICO score takes all of the information from your credit report. However, the banks or any other lending institution might look at your income, type of credit and employment history when you apply for a loan or mortgage.
Once a certain lender asks for a client's credit report, they can also ask for the Fico score. Other sources say that your Fico score will include 35% of your payment history, 30% of your credit utilization, and 15% as to how long have you been borrowing.
Explanation of credit score ranges
It is important to know the category that you fall into when it comes to credit score for you to be aware. The range of a credit score can go from 300 to 850. Always remember that the higher your score, the higher the chances of you to qualify for a loan. There will also be instances where a financing company is okay with 650 scores, while the other is fine with a 750 score. It will all depend on the lender itself.
A lender or a bank will check your credit score if you qualify for the application that you are requesting. Here are some of the credit score ranges that you should know.
Bad credit score
People with a credit score below 579 is known as high risks. Foreclosures, poor payment history, and bankruptcies are the reasons why people fall into this category.
Good credit score
A good credit score ranges from 680 to 719. People with this credit score can expect approvals and interest rates that are better.
A very good credit score ranges from 720 to 799. People with this credit score is known to be small risks, and they often get loan amounts that are higher than usual.
An excellent score ranges from 800 and above. Financial freedom is expected to people with this score.
What does it mean to have a credit score of 359
A low credit score is bad for your financial health. Individuals with a credit score below 359 are considered to have significantly damaged their credit history. There may be several causes of bad credit history, but a common cause is usually having multiple defaults spread among different credit products. In fact, it is worse to borrow from a lender, default payment and borrow from a second lender and so on.
Is 359 a bad credit score?
FICO and Vantage Score rate any credit below 500 as a bad credit score. However, how the industry calculates and determines this score has remained the financial industry's secret. The role of all customers is to ensure that they have maintained a positive credit score to maintain a healthy financial history. It is common to see a credit history from different credit referencing bureau suggesting that having a 359 FICO score. Therefore, you should not rely on one credit reference bureau to determine whether your 359 credit score is bad.
You've only seen 16% of your credit data with 359 credit score
Most people use FICO data because of its commonality. When lenders find out that you have a credit score of 50 and below, that means that they do not bother going beyond telling you what is wrong with your credit score. They will regard you as a risk when borrowing from them. A 359 credit score anywhere will regard you as having a poor financial health and risk to lenders. Sometimes, you may not have your financial history, but it is better to have a financial education for the same. Knowledge of credit score is important especially to safeguard against credit report errors.
Things you can do to improve your credit score of 359
A low credit score puts you at a disadvantage when you need support from financial institutions. As much effort as possible to be applied in ensuring your credit score is steadily improving. You, therefore, need to discipline when and how you get and use your credit. Here are a few tips to improve your credit rating.
Use credit cards responsibly
The use of credit cards and installment loans paid over a long time contributes to an improved credit score. You are at higher risk if you own credit cards that you don't use than another person who uses and manages them responsibly.
Close accounts only after paying them off
You should now that closing an account doesn't make it go away since it will still be reflected in your credit report. Therefore, you should only open a credit account only when you need urgent financial assistance, and all other options have failed.
Shop for good credit rates
You should search for credit that is offered at substantially low rates to prevent a negative effect on you rating. The rate you get should give you value for what you pay. Higher rates give you difficulty in repayment thus damaging your credit score.