Red Credit Card

"Good" Credit vs. "Bad" Credit - What It Really Means

Let's dive into the difference between good credit vs. bad credit and how your score can impact you.​

Good credit vs. bad credit. While you might hear about the difference between a good credit score and a not so good credit score, what do the terms "good credit" and "bad credit" really mean? Since good and bad are subjective, how do you know where you score falls? And how is your life impacted when you have a high score vs. a low score?

Let’s dive into the difference between these two credit categories and how your score can impact you.

Credit Score Ranges

Your credit score can range between 300-850.

Where your score falls within that range represents your creditworthiness - or how responsible you’ve been with managing your credit-related tasks such as making payments on time, not accumulating too much debt, and the like.

You want a good credit score because it follows you throughout different areas of your life, from qualifying for a loan to getting approved for a mortgage or apartment.

A high score makes getting approved for a credit line easier. It’s also less expensive because low-interest rates and high credit scores go hand in hand.

So, what are the typical credit score ranges?

According to myFico.com, there are five credit categories. You can see them below:

300-579: Very poor

580-669: Fair

670-739: Good

740-799: Very Good

800-850: Exceptional

Keep in mind that different sources will state that good credit starts at 690 or 700, so you want to take the specific starting point for “good credit” with a grain of salt. In this area, good is subjective and will depend based on who you ask.

What Is "Good Credit"?

670-739 is deemed good credit because it’s what’s acceptable in our society. When your score falls in this range, it’s near or slightly above the average US consumer score. Most lenders will approve your loan, give you an acceptable interest rate, or approve your credit line with this score. If your score is above this range - even better.

What Is "Bad Credit"?

Conversely, bad credit is seen as typically falling below 580. This is credit that is well below the average score for US consumers and shows that you’re a risky borrower for lines of credit and loans.

What Does Your Credit Score Mean When It Comes To Lenders And Applying For Credit?

Your credit score can impact various areas of your life - especially if you plan to borrow money or secure lines of credit for a home, vehicle, for personal reasons, or something else altogether.

Good credit helps you get an approval that comes with terms you can be proud of.

What Implications Might Someone Have Who Has A Lower Credit Score?

Having a lower credit score can make qualifying for big-ticket purchases and securing lines of credit more difficult and expensive. The same can be true for renting a home since you might not get approved or setting up an account with a utility company without having to make a down payment.

Over your lifetime, having bad credit will cost you in opportunities and cold hard cash as you pay more in security deposits, monthly payments, and overall due to high-interest rates.

What Are The Benefits Of Having A Higher Score?

With a good credit score, you will get more approvals with better interest rates.

This is because lenders trust that based on your credit score, you can manage your debt. Your credit score even goes further than financial lenders. Some property management companies, cell phone companies, and utility companies will check your credit to see whether you qualify or meet specific terms before moving forward with your desired service.

What Are The Ways To Improve Your Credit Score?

You can turn your credit score from bad to good. It happens all the time. While the steps are simple, implementation isn’t always easy, so having a strategy to remain consistent in your efforts can make all the difference.

  1. Dispute errors: Review your credit report to determine whether errors lead to a lower credit score than you should have.
  2. Make on-time payments: Pay your bills on time every month. If you can’t afford to make the payment, set up a payment plan. Payment plans won’t hurt your credit but failing to pay altogether will.
  3. Lower utilization rates: Your utilization rate is determined by comparing your balances to your available credit. An acceptable utilization rate is around 30%. If you carry higher balances on your credit cards, you want to develop a debt pay off plan to reduce your utilization rate.

In addition to these tips, you can use our free financial guidance resources and services to help get your credit score on track.

Understanding Good Credit vs. Bad Credit

Your credit score can significantly impact your ability to qualify for credit cards and loans, and how you use your credit cards can ultimately make the difference between you having good or bad credit.

While it’s essential to understand good credit vs. bad credit, you also want to learn how credit cards work and be sure to utilize your cards responsibly to build or improve your credit profile.

Learn How Credit Cards Work

default icon for Solution Finder Intro
What can we help you with?
default icon for Checking For Mature Members
What are you borrowing for?
default icon for Checking For Mature Members
Vehicle Options
default icon for Checking For Mature Members
Home Options
default icon for Carrolls
What are you saving for?
default icon for Carrolls
How old are your kids?
default icon for Cord
Which of these banking options are you interested in?
default icon for Cord
How old are you (or your child)?
default icon for Cord
How old are you?
default icon for Cord
What kind of account are you looking for?
search popup background

What are you looking for?

Common Links

Frequently Asked Questions

  • How can I access my Listerhill accounts without a nearby branch?

    If you live in Alabama or in south central Tennessee but don't have a Listerhill branch location nearby, there are still plenty of ways to access your accounts. You can use our online banking, mobile banking app, and cards app to access your accounts from your devices. You can also take advantage of our CO-OP Shared Branches for easy access to your money wherever you are. If you need to get in touch, we're always one call away.

  • Can I open a Listerhill account online?

    You can open your Listerhill account from the comfort of your home with our easy online application. Or, if you want to apply for a mortgage, you can learn more about our offerings and start your application here.

  • Am I eligible for membership at Listerhill?

    If you live, work, attend school, or own property anywhere in Alabama or Maury County, TN, you're in luck! You're eligible to become a Listerhill member.

  • The Great Giveback Official Rules

    1. Eligibility: No purchase or obligation necessary to participate and win. All participants must be 19 years of age or older at time of contest participation. Employees of Listerhill Credit Union are not eligible to register for the contest.

    2. How To Enter the Contest: All Listerhill members who have consumer loans in good standing, (subject to limitations below) are automatically entered. Anyone who takes out a new loan with Listerhill Credit Union, or refinances a loan from another lender with Listerhill Credit Union (subject to limitations below) will automatically be entered to win. Limit of one entry per loan.

    NO PURCHASE NECESSARY: To enter the contest without a loan, send a self-addressed, stamped envelope to: Listerhill Credit Union, P.O. Box 566, Sheffield, AL 35660, Attn: Great Giveback Contest Entry. Limit one entry per person. Written entries must be received no later than July 3, 2021.

    Listerhill Credit Union will not be responsible for incomplete, lost, late, misdirected or illegible entries or for failure to receive entries. All entries become property of Listerhill Credit Union and none will be returned. Any questions regarding the number of entries submitted shall be determined by Listerhill Credit Union in its sole discretion, and Listerhill Credit Union reserves the right to disqualify any entries by persons determined to be tampering with, violating, or abusing any aspect of the contest.

    3. Contest Entry Requirements: In the event the Credit Union, in its sole discretion, determines that any Entry contains content that does not comply with these Official Rules or does not otherwise comply with regulatory guidelines, Credit Union reserves the right to disqualify the entry.

    4. Determining the Winner: A Credit Union employee will select at random four (4) $500 winners (one per day July 12-15) and one Grand Prize Winner from all entries received on July 16, 2021. You do not have to be present to win.

    5. Prizes: $500 Cash Prize: the Credit Union will award four (4) members with $500 cash each. Grand Prize: The Credit Union will pay up to $25,000 toward your loan with Listerhill Credit Union, or combination of loans. No loan payments will be made to loans with any other lender. No cash equivalent provided, and the total prize amount may be less depending on the outstanding amount of loan balance(s) with Listerhill Credit Union. In no event will the prize awarded exceed the total amount of the winner’s outstanding balance of qualifying loans with Listerhill Credit Union. Federal, state and local taxes are the sole responsibility of the winner. IRS regulations require the Credit Union file a 1099 on behalf of the winner.

    A Credit Union employee will call the prize winners and the prize winners will be called up to five times during regular business hours at number provided on entry form and will leave no messages. Failure to reach winner during these calls may result in disqualification of winner, forfeiture of his or her interest in all prizes, and selection of a substitute winner drawn from the drum. Winner will be required to schedule a time, at least 48 hours in advance, to visit Listerhill Credit Union, located at 4790 2nd Street, Muscle Shoals AL, 35661 in person, during regular business hours within seven (7) days of being notified to claim prizes by providing proof of eligibility for prize won and completing and signing an affidavit of eligibility and a liability and publicity release. Failure of any Winner to timely contact the Credit Union, visit the above Credit Union office in person and sign and return any required affidavit and release, or to claim a prize or comply with any term or condition of these Official Rules, will result in drawing Winner's disqualification and the forfeiture of his or her interest in the prize. Winners may waive their right to receive prizes. Prizes are non-assignable and nontransferable. No substitutions allowed by winner.

    6. To be eligible to win, all loans must be in good standing (not more than 30 days past due at the time of drawing. Eligible loans are limited to auto loans (no indirect dealer loans), personal loans (no loans secured by real property, such as mortgages, 2nd mortgages, and Home Equity Lines of Credit) and recreation loans made to consumer borrowers (not business or commercial loans).

    6. Participation. By participating, entrants agree to be bound by these Official Rules and the decisions of the Contest. Except where prohibited, acceptance of any prize constitutes winner's consent to the publication of his or her name, biographical information and likeness in any media for any commercial or promotional purpose, without limitation the Internet, or further compensation. Prizes not won and claimed by eligible winners in accordance with these Official Rules will not be awarded and will remain the property of the Credit Union.

  • How do I redeem my Merchandise Rewards?

    The easiest way to redeem your Merchandise Rewards is to log into Listerhill’s Online Banking and click the “Get Info” link to the right of your credit card information. This will take you to our credit card servicing site within the same window. Select “Rewards” on the upper right side within the screen (below FICO Score) and on the next screen, click on the CURewards logo. This will automatically sign you in to be able to redeem your Merchandise Rewards points!