credit cards

What is bad credit, and can it hurt you?

When most people worry about whether they have good credit or bad credit, they're thinking about their credit score. This three-digit number between 300 and 850 provides a quick snapshot of how responsible and reliable you are at managing and paying off your debt.

In today's economy, some experts will say you have bad credit if your score is 675 or lower; a score of 620 or lower will typically be classified as subprime, says Liz Pulliam Weston, author of "Your Credit Score."

Here are the five main credit score components and how much weight they carry:

Because each debt is weighted differently, credit mistakes have different effects. For example, if you apply too frequently for new credit cards, you may lose only a few points. Missing a credit card payment will ding your score far more, says Weston.

The more mistakes you make, the lower your credit score will be and the more likely you will have bad credit. Bad credit, in turn, will make it harder for you to get a mortgage loan, a car loan or a student loan. It will also make it more difficult to get a credit card. If you do receive a loan or a credit card, bad credit means that you will likely have to pay a higher interest rate on the money you borrow, says Weston.

News alert Create a news alert for "bad credit"


Show Bankrate's community sharing policy
          Connect with us
Product Rate Change Last week
Balance Transfer Cards 16.23%  0.01 16.24%
Cash Back Cards 16.49%  0.06 16.55%
Low Interest Cards 11.48%  0.11 11.59%
Credit cards on a table

Get advice for managing credit cards, building your credit history and improving your credit score. Delivered weekly.


Credit Card Blog

Sheyna Steiner

US dragged into modern payment era

Soon, consumers get a full-fledged payment revolution with EMV cards. Will fraud decrease?  ... Read more

Partner Center

Connect with us