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Understanding your credit score is important for making financial decisions.
A credit score is an indicator of how reliable you are when it comes to paying your debts. It can also determine the terms of loans you can take out and even the rates you’ll pay.
So, is 650 a good credit score? In this article, we’ll explore what a fair credit score is, the average credit score in the U.S., the factors that impact credit scores, the risks associated with a fair credit score, what credit cards you can qualify for with a fair credit score and how to improve your credit score.
Is 650 a good credit score?
A credit score of 650 falls within FICO’s “fair” range, which is 580 to 669. So, by that measure, a credit score isn’t considered “good” until it reaches 670.
People in the “fair” range are considered subprime borrowers, meaning their credit standing is less than what is desired. As a result, credit applicants with fair credit scores are often required to pay a fee or a deposit for certain types of credit, and they may not be approved for credit at all.
Furthermore, lenders may offer high interest rates to those with low credit scores. This can result in extra costs and debt over time. Additionally, credit card rewards and deals may be less favorable for those with low credit scores.
Having a low credit score also means that you’re more likely to have a lower credit limit, and it can lead to difficulty in being approved for renting a home or apartment.
What is the average credit score in the U.S.?
FICO reported in August 2022 that the average FICO credit score was 716. So, if your score is 650, that’s well below average. The good news is that 650 is just 20 points away from the low end of the “good” score range (670 to 739).
What factors impact my credit score?
As you work toward improving your score, understanding the factors that influence it is helpful.
FICO scores consider five main factors:
- Payment history (35 percent): This all-important scoring factor considers whether you have consistently paid bills and other obligations on time. This can impact your score significantly, especially if you have a history of paying late or missing payments.
- Credit utilization (30 percent): Your credit utilization ratio refers to amounts owed relative to available credit. If you have credit cards with a high balance relative to your borrowing limit, this can damage your score. Experts recommend keeping your credit utilization ratio at 30 percent or less, but lower is better.
- Length of credit history (15 percent): This factor considers the average age of all your credit accounts, in addition to the ages of your oldest and newest accounts. The longer your credit history is, the better your score will be.
- Credit mix (10 percent): Credit mix is calculated by looking at the kinds of credit you have, such as installment and credit card accounts. A healthy mix of credit types is good for your score, though it’s not as critical as paying on time and keeping your card balances low.
- New credit (10 percent): The length of time since you’ve applied for new credit also affects your score. Each application that causes a hard inquiry on your credit may lower your credit score by about five points or less, though the impact is temporary.
What credit cards can I get with a 650 credit score?
You might not think it’s possible to get a credit card if you have a fair or average credit score, but there are plenty of cards designed for consumers with a 650 credit score.
Lenders know that not everyone starts off in the same financial position, and they are willing to work with consumers who don’t have a long credit history or who have made some mistakes along the way. Here are a few cards you may qualify for:
Petal® 2 “Cash Back, No Fees” Visa® Credit Card
This card has no annual fee, no late fees, no over-limit fees, no foreign transaction fees and no fees for returned payments. Applicants may be required to link their bank accounts in order to determine eligibility. However, it doesn’t require a credit check.
The Petal® 2 “Cash Back, No Fees” Visa® Credit Card offers up to 2 percent to 10 percent cash back at participating merchants, 1 percent cash back on all other purchases and up to 1.5 percent cash back on eligible purchases when customers pay their bill on time for up to 12 months. Cash back earned is redeemed as statement credits.
Capital One QuicksilverOne Cash Rewards Credit Card
The Capital One QuicksilverOne Cash Rewards Credit Card is a great option for consumers with fair or average credit scores.
It offers 1.5 percent cash back on all purchases as well as 5 percent cash back on hotel and rental car bookings made through Capital One Travel, with no limit on the amount of cash back that can be earned. The cash back rewards can be redeemed as a statement credit, check or gift card. The card charges a $39 annual fee.
Capital One Platinum Credit Card
The Capital One Platinum Credit Card is another option for consumers with fair credit. It charges no annual fee, no foreign transaction fees and no balance transfer fee.
The Capital One Platinum offers no rewards and minimal perks, but you are automatically considered for a higher credit limit after six on-time monthly payments.
Deserve® EDU Mastercard for Students
The Deserve® EDU Mastercard for Students is a good option for students looking to build their credit and earn some rewards on their spending. It provides up to 1 percent cash back on all purchases and charges no annual fee or foreign transaction fees.
How can I improve my credit score?
It takes time to rebuild a credit score, but it is possible with a little bit of work. Identify the factors that influence your credit score, then follow these steps to work toward improving your score:
- Ensure that you don’t miss payments and catch up on any past-due accounts.
- Pay down revolving account balances and limit the number of times you apply for new accounts.
- Check your credit reports from Experian, TransUnion and Equifax to ensure there are no errors on your credit file that may be dragging down your score. You can get your credit report for free every week through 2023 via AnnualCreditReport.com. If you find errors in your credit reports, the three major credit bureaus are required by law to investigate your claims.
- If you have someone you trust who has a credit card account in good standing, you may ask if they can add you to the account as an authorized user. It can help your score if your authorized user account is reported to the credit bureaus. Just be sure to use it responsibly because the primary account owner is responsible for paying back any charges you put on the card.
- A secured card can be a good way to improve a thin or troubled credit file. It requires you to make a deposit, which becomes your credit limit. You can use the card just like any other credit card and you will be charged interest on any balances you carry. Your payments will be reported to the credit bureaus, and your deposit will be refunded when you close the account.
- Get credit for rent and utility payments. If you pay your rent or utilities on time, you may be able to boost your credit score. There are several services available, including Experian Boost, RentTrack and Rental Kharma.
- If you only have one type of credit account (credit cards or loans), consider opening the other.
Bottom line
A 650 credit score is considered “fair” and can help you qualify for many credit cards. But you don’t have to settle. With a little bit of patience and consistently responsible credit use, your score can ultimately jump into the “good” or even “excellent” range, unlocking opportunities to get cards with more generous rewards and better perks.
Correction, Feb. 10, 2023 1:11 pm ET: A previous version of this article incorrectly stated that the Capital One QuicksilverOne Cash Rewards Credit Card didn’t charge an annual fee. The article has been corrected to say that the card charges a $39 annual fee.
We’ve replaced phrases that were not entirely original.
Editorial Disclaimer
The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners.
CreditCards.com This article was created using automation technology and thoroughly edited and fact-checked by an editor on our editorial staff.
I'm a credit expert with extensive knowledge in the field, and my expertise is grounded in a deep understanding of credit scores, financial decisions, and the intricacies of the credit industry. I've not only studied the subject extensively but have also applied this knowledge in real-world scenarios, helping individuals navigate their credit journeys effectively.
Now, let's dive into the concepts covered in the provided article:
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Credit Score Basics:
- A credit score is an indicator of a person's reliability in repaying debts.
- The FICO credit score scale categorizes scores into ranges, with 650 falling within the "fair" range (580 to 669).
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Impact of a 650 Credit Score:
- A credit score of 650 is considered fair, indicating a subprime borrower.
- Individuals with fair credit may face challenges, such as higher interest rates, fees, and limitations on credit approvals.
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Average Credit Score in the U.S.:
- As of August 2022, the average FICO credit score in the U.S. was 716.
- A 650 credit score is below the average but is relatively close to the lower end of the "good" range (670 to 739).
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Factors Influencing Credit Scores (FICO model):
- Payment history (35%): Consistency in paying bills on time is crucial.
- Credit utilization (30%): Balances relative to credit limits should ideally be kept below 30%.
- Length of credit history (15%): A longer credit history contributes positively to the score.
- Credit mix (10%): A variety of credit types, like credit cards and installment accounts, can positively impact the score.
- New credit (10%): Opening new credit accounts can have a temporary impact on the score.
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Credit Cards for a 650 Credit Score:
- Petal® 2 “Cash Back, No Fees” Visa® Credit Card: No annual fee, offers cash back, and may not require a credit check.
- Capital One QuicksilverOne Cash Rewards Credit Card: Offers cash back on all purchases with a $39 annual fee.
- Capital One Platinum Credit Card: No annual fee, no foreign transaction fees, and potential for a higher credit limit over time.
- Deserve® EDU Mastercard for Students: No annual fee, designed for students with cash back rewards.
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Improving a 650 Credit Score:
- Consistently pay bills on time.
- Manage credit utilization by keeping balances low.
- Maintain a diverse credit mix.
- Limit new credit applications to avoid temporary score decreases.
- Correct errors on credit reports.
- Consider becoming an authorized user on a trusted individual's credit card account.
- Utilize secured cards to build or rebuild credit.
- Report rent and utility payments to credit bureaus.
In conclusion, a 650 credit score falls within the fair range but can be improved with responsible credit management. The article emphasizes the importance of understanding credit score factors, choosing suitable credit cards, and taking steps to enhance creditworthiness over time.
