625 Credit Score: Good or Bad?

Last Updated: Apr 05, 2023

  • A 625 credit score is considered "Fair"
  • Having a “Fair” credit score can cost you 1000s of dollars in extra interest over the lifetime of your loans
  • Call us today to find out how you can repair your credit (fast)!

Is 625 a good credit score?

As mentioned above, a 625 FICO® Score is considered “Fair”. This is typically a result of situations such as:

  • You’ve had payment problems (late payments, missed payments, etc)        
  • Accounts have been charged off & sent to collections        
  • Sometimes even foreclosures & bankruptcies

Approximately 17% of all consumers in America have FICO® Scores in the “Fair” range (625-669).

With a 625 FICO® Score, you’ll mostly be dealing with “subprime” lenders. Which means you’ll be charged relatively high interest rates & fees.

How to improve a 625 credit score

To improve your credit score, you need to focus on fixing the underlying factors.

  • Always make your minimum payments, and ensure they’re paid on time        
  • Keep your credit card balances as low as possible (also known as a low utilization rate)        
  • Build your credit file by making sure the accounts you do open, get reported to the 3 major credit bureaus (Equifax, Experian & Transunion)        
  • Only apply for credit when necessary, this keeps your hard inquiries at a minimum

Not sure where to start? A dedicated credit repair agency, like us, can work with you to ensure you’re maximizing all avenues when it comes to improving your score.

What can you do with a 625 credit score?

As mentioned previously, a 625 credit score is considered “Fair”. So your lending options are going to be somewhat limited. You’ll mostly get lending through subprime lenders.

Subprime lenders will charge higher interest rates & fees, as they’re taking on “higher risk” clients.

What kind of interest rate can you get with a 625 credit score?

It will typically only be subprime lenders that will approve your applications, and this comes with higher interest rates & fees.

These higher interest rates can cost you thousands of dollars in added interest over the lifetime of your loans, in comparison to if you had a “Good” credit score.

We highly recommend you take the necessary steps towards repairing your credit, and securing a better financial future for yourself, before applying for loans.

The Importance of Understanding Credit Scores

Your credit score is a numerical figure that ranges from 300 to 850, and it is utilized by lenders to evaluate your credit value. An assessment of 625 falls in the "fair" class and is not a terrible score; however, it can restrict access to certain financial services and lead to higher rates of interest.

A number of components contribute to the calculation of your credit score, such as payment history, utilization rate, length of credit history, types of credits used, and recent inquiries. Being aware of each factor and how they affect your score can enable you to make informed choices that will help you enhance your rating with time.

The Benefits of Maintaining a Great Credit Rating

Upholding a great credit rating has many advantages such as access to preferential interest rates, higher credit limits and improved loan terms. All of these lead to saving money on interests, gaining more financial freedom and enjoying a better lifestyle.

A strong credit score may also help in getting essential items like an apartment, car or mortgage. Employers and landlords may investigate your credit report to measure your financial responsibility.

By keeping up a good credit score, you showcase lenders or other financial institutions that you are reliable and therefore more likely to obtain favorable deals for credits or loans.

Need help improving your credit score?

Can I get a mortgage/home loan with a 625 credit score?

It will be difficult to secure a mortgage with a 625 credit score, but it is definitely possible.

It will be expensive (higher interest rates & fees), and can cost you 10s of thousands of dollars in extra interest over the lifetime of your loan.

Instead, we recommend focussing on improving your credit score, to at least 670-739 (which is considered “Good”). Once you’ve increased your score, you’ll be in a much better place to apply for a mortgage & most importantly, you’ll save yourself a ton of money on interest payments.

Can I get a car loan with a 625 credit score?

You shouldn’t have any problems getting an auto loan with a 625 credit score. But do expect to pay more for the loan than what you would with a “Good” credit score (between 670-739).

You will still be considered higher risk by the lender and subsequently be charged higher rates, so you might consider increasing your credit score before getting an auto loan.

Can I get a personal loan with a 625 credit score?

Yes you should be able to get a personal loan with a 625 credit score. It may take a little bit of searching around for the right lender, but it is possible.

Bottom Line

Let’s face it, a 625 credit score is OK, but can be better. Applying for any forms of lending is slightly difficult, and you’ll pay higher interest rates & fees.

The best course of action (by far), is to improve your credit score first before you apply for loans. Not only will it open more doors for you, it will also save you a ton of money in the long run (due to lower interest rates).

Need help improving your credit score?

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