What does a good credit score look like?

Having a good credit score opens doors to improved financial benefits, including wider access to a range of loans and mortgages. In some cases, it can help you secure lower interest rates as you can prove to lenders that you’re a reliable borrower, even if you're a first time buyer.

Credit scores essentially act as a snapshot of your financial reliability, so a good score can make the difference between an approval and a rejection for your mortgage application. That’s why keeping an eye on it is essential, and knowing what a good credit score looks like is the first part of that.

How is a credit score calculated?

Credit scores can range anywhere from 300 to around 1,000 and are calculated based on information from your credit report. There are three main factors that influence your score:

Payment history: Timely payments on loans and credit cards are crucial
Debt levels: Higher debt balances can have an impact on your score
Credit history length: A longer credit history with evidence of responsible use can help boost your score

While actual credit scores will vary based on which company you’re using, these general ranges can provide a good indication of creditworthiness:

Excellent: 800+
Very good: 740-799
Good: 670-739
Fair: 580-669
Poor: 300-579

How do I check my credit score?

You can easily check your score online for free using one of the three main credit agencies. These are Experian, Equifax, and Callcredit. All you need to do is make an account and input some information about yourself and your financial history.

Your bank may also be able to provide credit score information to you, often through online portals or apps.

Finally, you could choose to use more detailed credit monitoring services, as these will give you a complete picture of your credit history, as well as what’s causing any changes. These do typically come with a monthly fee.

Remember, checking your credit score won’t impact it, as this is what is considered a soft enquiry.

How often should I check my credit score?

You should check your credit score at least once a year, but there are specific occasions when it’s important to check in:

Before a major purchase: Before applying for a mortgage, car loan, or credit card, check your credit score to get a better idea of what you might qualify for.
If you suspect fraud: If you notice unusual activity on your report, check your score immediately and contact the appropriate organisations as soon as possible.
If you’ve made big financial decisions: After taking out a loan, making a big purchase, or even if you’ve been taking steps to improve your score.

Things that impact your credit score

Your payment history, debt, credit history, types of credit, and credit inquiries all impact your credit score. Let’s expand on what that means:

Payment history: Consistent and timely payments on loans and credit cards are very important. Late or missed payments can have a major impact on your credit score.
Debt levels: Higher levels of debt can negatively impact your score. Aim to keep your credit utilisation ratio (the amount of credit you use compared to your limit) low.
Credit history length: A longer credit history with a track record of responsible borrowing can positively impact your score.
Credit inquiries: Too many credit inquiries in a short space of time can lower your score. This is when organisations run hard checks against your account to verify your score.
Types of credit: In some cases, the mix of credit types can affect your score. These can include revolving credit (credit cards, retail credit), instalment loans (mortgages and car loans), and more.

To improve your credit score, consider these tips:

Pay bills on time: Prioritise making payments on time to avoid late fees and the negative impact on your score.
Reduce your debt: Work towards paying off debt, especially high-interest credit card debt.
Limit new lines of credit: Try to avoid opening too many new credit accounts, as it can increase your risk of missing payments, and can impact your credit score.
Monitor your credit report: Regularly review your credit report for errors and inconsistencies.
Take advantage of free services: Some credit bureaus will allow you to take actions such as linking bank accounts directly, which can help boost your score.

For more detailed information on improving your credit score, check out our dedicated article below:

How to improve your credit score

Do you need a good credit score for a loan, credit card or mortgage?

The short answer is yes, but you can still get a mortgage or loan with a low credit score. Your interest rates will likely be higher, and you may end up paying more in the long term.

Ultimately, the higher your score, the better.

Higher scores can also increase your chances of approval and may give you access to higher credit limits.

If you have a low credit score, you may have lenders deny loan applications or offer less favourable terms. As part of that, you may get higher interest rates and lower credit limits.

Check out this article if you’re interested in getting a mortgage but have a low credit score:

A guide to getting a mortgage with bad credit

Does your credit score matter?

Definitely! Your credit score is an important part of your financial profile, and is a good indication of how ‘healthy’ your finances are. Having a good credit score can significantly improve your chances of getting approved for loans, including mortgages. It may also open doors to better interest rates and even help with rental applications, as landlords may check your score as part of the rental process.

If you’re struggling with debt or low credit, you can reach out to the following support agencies for help:

Stepchange: Impartial and confidential debt advice
National Debtline: Free debt advice charity
Citizen’s Advice: Help if you’re struggling to pay your bills

By taking proactive steps to improve your credit score, you can unlock a world of financial opportunities.

Expert mortgage advice

If you need help understanding how your credit score affects your mortgage options, get in touch with one of our expert advisers.

Whether you’re buying for the first time, looking to remortgage, or moving home, we’re here to help.

Contact us today to talk about your specific needs and learn more about how we can help you achieve your homeownership goals.

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Frequently asked questions

A healthy credit score will typically range from ‘good’ to ‘excellent.’ While different credit bureaus have their own scores, the higher the number, the better.

Experian and Equifax use a 1,000 point grading system, and the closer you are to 1,000, the better. However, anything above 881¹ is considered ‘good.’

There isn’t a strict minimum credit score you need to buy a house, but lenders typically prefer borrowers with good credit scores. Some lenders may be willing to work with lower scores in exchange for higher interest rates.

The average credit score in the UK can vary, and it will change depending on area and age. According to Loqbox², a credit building resource, the averages for each bureau are:

Experian’s average is 797 out of 999.
Equifax is 585 out of 1,000
TransUnion is 573 out of 710

Important information

Your home may be repossessed if you do not keep up repayments on your mortgage.

There may be a fee for mortgage advice. The actual amount you pay will depend on your circumstances. The fee is up to 1% but a typical fee is 0.3% of the amount borrowed.