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 may 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 and use information from different sources, it’s not unusual for your credit score to vary across bureaus.

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.

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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:

Equifax credit score bands

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Source: Equifax.

Experian credit score bands

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Source: Experian.

Illion credit score bands

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Source: Illion, Credit Simple.

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 could 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 one 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, according to Credit Simple, a credit score website which is part of the Illion group of companies. This is because a score in this range 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 or other credit product that you’ve been paying off reliably. According to Equifax, if you fall into this category 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, Credit Simple 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 person’s odds.

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Average

If you have an ‘Average’ or ‘Fair’ credit score, you are seen to have an ‘average’ possibility for an adverse event to be 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. Another factor, according to Credit Simple, may be that your good history with your current credit provider is not yet being reported.

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 Credit Simple, 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.

Learn more: What is a bad credit score?

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 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.

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