Credit ratings are not irreversible, because by making several financial changes, you could be able to boost your score and step into a higher credit tier, which may result in lower interest rates when you finally close on your mortgage.
Credit ratings vary considerably from 300 to 850, but some home loans and bank credit card scoring will go as high as 900. The rule of thumb for borrowers is that the stronger your credit rating, the lower your interest rate will be.
Most borrowers’ credit ratings, on the other hand, are not among the greatest. According to credit scoring firm Experian, the median FICO score in 2021 was 711. According to Experian, the following is how credit ratings were spread around the country last year:
Credit score ranges and percentages
Exceptional: 800-850 – 21%