Credit score ranges: What are they and what do they mean?

When it comes to your credit score, are you ‘below average’, ‘good’, ‘very good’ or even ‘excellent’? These are just some of the categories or bands credit score companies use to sort consumers. Which one you fall into could have a big impact on how easy it will be for you to get credit or a loan.

Each credit score provider has its own way of calculating and categorising a consumer’s credit score – the number which represents how trustworthy you are as a borrower to lenders. Your score will typically be somewhere between zero to 1,000 or zero to 1,200, depending on which credit bureau you go through. Because they generally employ different methods of calculating the scores – using information from different sources – it’s not unusual for your credit score to vary across bureaus.

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Where you sit on the credit score scale – that is, whether your credit score is considered ‘excellent’, ‘very good’, ‘good’, ‘average’ or ‘below average’ (or some variation of one of these) – may also differ depending on the provider calculating your score.

What are the main credit score ranges?

Here’s a breakdown of the credit score ranges of three of Australia’s largest credit score providers, Equifax, Experian and Illion:

Below Average  Average Good Very Good Excellent
Equifax score range 0-505 506-665 666-755 756-840 841-1,200

Source: Equifax

Below Average  Fair Good Very Good  Excellent
Experian score range 0-549 550-624 625-699 700-799 800-1,000

Source: Experian

Zero score A low score Room for improvement Good Great Excellent
Illion score range 0 1-299 300-499 500-699 700-799 800-1,000

Source: Illion

What does each credit score category mean?

Having a high credit score may mean you are seen as less of a risk to lenders. As a result, you may have a greater chance of being approved for a credit or loan product. In some cases, it could also mean you can access more attractive interest rates and other loan terms. On the other end of the scale, a poor credit score can make it more difficult to get a loan or other credit product at a competitive rate, or to get approved at all. 

As you can see from the credit score ranges above, there’s no standard scale of credit scores. However, based on information gathered from Equifax, Experian and Illion, this is what the different categories may generally mean: 

Excellent

‘Excellent’ credit scores are often associated with older age groups, Illion says. This is because it generally means you have a strong credit history that you’ve built up over the years to be well above the average. It’s also likely you have been fairly disciplined with your credit applications and may already have a home loan that you’ve been paying off reliably. According to Equifax, you are seen as highly unlikely to have an adverse event (such as a loan default or court judgement) on your credit report in the next 12 months. 

Very Good

A ‘Very Good’ credit score means you are above the average, according to Experian. You are probably paying your bills on time, Illion says, but you may have a fairly short credit history or you may have made a few recent credit enquiries or applications for loans. You are seen as unlikely to have an adverse event recorded on your credit report in the next year. 

Good

If you have a ‘Good’ credit score, this means you probably don’t have anything significantly negative (like defaults or bankruptcies) on your credit report. You may also not have a very long credit history. According to Equifax, your score suggests it’s less likely that an adverse event will be recorded on your credit file in the next 12 months. That is, the odds of no adverse events occurring are better than the average population’s odds. 

Average

If you have an ‘Average’ credit score you are seen as likely to have an adverse event recorded on your credit report in the next year, Equifax says. This may be because you are in a younger age bracket, which lenders may see as a bit riskier than older people who’ve had more experience paying back loans. 

Below Average

A ‘Below Average’ or low credit score means lenders are likely to see you as a risky borrower, and as a result you may have trouble getting approved for a credit product. According to Illion, you may have defaults or other negative data on your credit file, for example, you may consistently pay your bills late. You may also have a high number of credit enquiries. According to Equifax, you are seen as more likely than the average population to have an adverse event on your credit file in the next 12 months. 

To help you interpret your credit score, Canstar has written specific articles on Equifax, Experian and Illion credit scores and reports. 

If you’re looking to improve your credit score, you might find our seven tips to help build up your credit score useful. If you’re happy with your current score and want to keep it that way, take a look at our article on how to maintain your credit score

To find out more about credit scores and check your credit score for free, visit our credit score information hub.

This article was reviewed by our Sub Editor Tom Letts and Finance Editor Sean Callery before it was updated, as part of our fact-checking process.

Main image source: garagestock (Shutterstock).

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