According to FICO’s classifications, your 615 credit score places you in the “Fair” category. Here are all of the different ranges:
- Very Poor: 300 to 579;
- Fair: 580 to 669;
- Good: 670 to 739;
- Very Good: 740 to 799;
- Exceptional: 800 to 850.
If you just ordered your annual credit report and want to know why you have a 615 score, what you can do with it, and how you can improve it, keep reading.
Table of Contents
Why Your Credit Score Is 615
A variety of factors can lead to a 615 score. Here, we’ll outline some common ones that can negatively impact your score and cause it to be what it is.
Late or Missed Payments
Your ability to repay your debts signals to the lender what they might expect if they approve you for an installment loan, retail account, credit card, mortgage, or another type of account. Given its importance, this factor makes up 35% of your credit score.
Fortunately, payments only a few days late will not impact your score. It’s only once a payment’s at least 30 days late that it’s sent to the reporting bureaus.
Debt in Collections
It takes several unpaid billing cycles (120 to 180 days, typically) for a lender to consider your loan defaulted and sell your account to a collections agency. Then, the agency will contact you directly via phone, email, and snail-mail in an attempt to pay off the debt, which they legally own.
Collections are a subset of payment history, and having one or more collections claims on your credit report could be a reason why you have a 615 credit score. Precisely how much it will impact your score depends on several different factors, including:
- The number of delinquent accounts on your record;
- How late your payments are;
- How much money you owe on the delinquent accounts.
The amount of time that has passed since you paid off your debt can also impact the severity of your collections claim.
Adverse Public Records
Adverse public records are reported to credit bureaus by local, county, state, or federal courts and include bankruptcies, foreclosures, judgments, repossessions, and tax liens. These signal to lenders that you have a serious delinquency, so they’re the worst record to appear on your credit report.
For example, if a collections company can’t recoup the debt you owe, they may take legal action to get you to pay. If the court rules in favor of the collections company, the action becomes a matter of public record, which will find its way onto your credit report.
Keep in mind that not all public records, such as divorces, impact your credit score.
Precisely how much an adverse public record drops your score depends upon the type of public record and other details in your report. But from a high-level perspective, having one of these public records on your account could drop your score by 200 points or more, and it will continue to impact your score for 10 years.
Unpaid tax liens could lower your score for up to 15 years.
Fortunately, public records hurt your credit score less and less as they get older.
Short Credit History
How long you’ve had credit accounts for 15% of your credit score. So, while it’s not the most critical factor in this list, a short credit history can make a serious impact on your score.
After all, if you don’t have a lengthy credit history, lenders can’t gauge how likely you are to repay the debt as agreed. Consequently, your credit score will reflect the situation.
High Credit Utilization
Credit utilization rate, also known as utilization ratio, is a percentage that references how much credit you have compared to your overall credit debt.
For example, if you have $70,000 in available credit with $9,300 in revolving credit debt, your utilization rate is about 14%.
Utilization rates impact up to 30% of your credit score, depending on the scoring model. So, while they’re not the biggest factor, they are highly influential.
Hard vs. Soft Credit Inquiries
Examples of a “soft” credit inquiry are when you check your credit, when a bank or other lender pre-approves you for an offer, and when an existing creditor checks your credit. Because of their nature, soft credit inquiries don’t impact your score.
Hard credit inquiries, on the other hand, will temporarily decrease your credit score by five points or less. This is because hard inquiries only occur when you apply for a new line of credit, and the lender accesses your file to determine the level of risk when giving you money.
While one or two hard inquiries won’t raise any red flags, if you have multiple inquiries within a short period, this could signify that you’re opening a lot of new accounts, which could mean you’re having trouble paying bills or you’re planning to overspend.
With these details in mind, let’s find out which credit options are open to you with a 615 score.
What Can You Do With a 615 Credit Score?
While you won’t qualify for just any card, you’ll likely be eligible for no annual fee, no foreign transaction fee, and your favorite store’s credit cards. You could also obtain cards with 0% introductory financing. Personal loans and apartment rentals fall into the “maybe” category.
Outside of 0% credit card offers, it’s crucial to keep in mind that you won’t qualify for cards with rewards or large initial bonuses, or the lower interest rates obtained by those with Good, Very Good, or Exceptional credit scores. The same goes for the best mortgage, auto loan, and insurance rates.
With a 615 score, you’re squarely in the middle of the fair range, so movement in either direction could have a significant impact on your ability to borrow money and how much you’ll have to pay in interest.
Next, let’s find out what you can do to increase your score.
How to Improve a 615 Credit Score
Although you have a Fair credit score, the good news is that there are several actionable steps you can take to improve it. These include:
Pay Your Bills on Time
One of the biggest ways to positively impact your credit score is to pay your bills on time. It won’t happen overnight, but as long as you manage your money properly and pay at least the minimum bills due each month, you’ll see your score steadily climb.
Keep Your Credit Utilization Low
Even if you have higher credit limits available, it’s wise not to max them out. Not only will this help prevent you from late or missed payments, but it will also reflect positively on your credit report.
Obtain a Secured Credit Card
Secured credit cards require you to place a deposit, usually equal to your credit limit. This way, if you don’t pay your bill on time (or at all), the lender already has enough money on hand to repay your balance.
Talk With a Debt Management Professional
Credit repair companies specialize in looking at your credit report, finding any errors, and then reaching out to the three bureaus to remove these mistakes. Once they’re off your report, you can expect your score to rise.
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