Editor’s note: Lantern by SoFi seeks to provide content that is objective, independent and accurate. Writers are separate from our business operation and do not receive direct compensation from advertisers or partners. Read more about our Editorial Guidelines and How We Make Money.
If you have a credit score of 590, you are considered to have fair or poor credit. Scores in this range can make it difficult to qualify for loans and credit cards with good rates and terms, since lenders see you as a higher risk. The good news is your credit score isn’t set in stone and can change over time based on your financial behavior. Here’s a closer look at what a 590 credit score means, how it can impact your credit options, and what you can do to build your credit profile.
What Does a 590 Credit Score Mean?
Most credit scores range from 300 to 850. With the FICO® scoring model, one of the most commonly used, here’s how scores break down:
Poor: 300-579
Fair: 580-669
Good: 670-739
Very good: 740-799
Exceptional: 800-850
A 590 credit score falls into the “fair” group. With VantageScore®, another widely used scoring model, 590 falls into the “subprime” group (score of 300-600). While a 590 credit score is below the average credit score, you’re not alone: According to Experian, one of the three major credit bureaus, 15.8 percent of all consumers have a FICO credit score between 580 and 669.
Causes of a Fair Credit Score
How did you get here? Fair credit is often due to poor payment history. Experian data shows that 39% of people with a score of 590 have late payments of 30 days past due on their credit reports. Having an account in collections or a major negative event, such as a bankruptcy or foreclosure, on your credit report can also contribute to a poor credit score.A score of 590 can also be the result of being new to credit. If you don’t have much or any credit history, your score may be low for a while. However, once you start borrowing money and making on-time payments, it should build over time.To understand exactly why your credit score is 590, it can be a good idea to get a copy of your credit reports from the three major consumer credit bureaus (Equifax, Experian, and TransUnion). You can access your reports for free at AnnualCreditReport.com. Errors on consumer credit reports can also contribute to a low score, so you’ll want to read your report over carefully.
How Might a 590 Credit Score Impact Financing?
Some lenders may reject applications from consumers with scores in the fair or poor range. Other lenders, especially ones that specialize in subprime lending, are willing to work with people who have scores of 590 but will charge relatively high interest rates and fees to compensate themselves for carrying more risk. They may also require a shorter repayment term, offer a smaller loan amount or credit limit, and/or require a cosigner.For example, you generally need a personal credit score of at least 620 to qualify for a conventional mortgage and at least a 600 to qualify for a traditional auto loan. A score of 590 doesn’t mean you can’t get these loans, but it may mean that your rates and terms won’t be ideal.The same thing applies to credit cards. While it’s possible to get a credit card with a score of 590, your choices may be limited to secured cards (more on that below) or a card with an annual fee.With a 590 score, you may also have to pay a deposit when signing up for utilities or a cell phone plan, and make a larger security deposit on an apartment. Recommended: Applying for a Credit Card: The Process Explained
Factors That Influence Your Credit Score
A credit score is essentially a numerical representation of your credit report. By understanding what impacts your credit score, you can take steps to improve your history over time. Here's a detailed breakdown of the five specific factors that influence your FICO score.
Payment History
Whether or not you’ve paid your bills on time — aka your “payment history” — makes up a full 35% of your score. Making one late payment may not have much of an impact, but several late payments may cause your credit scores to drop.
Credit Usage Rate
Your credit usage rate, also known as credit utilization ratio, is the percentage of available credit you are currently using. It’s the sum of all your balances, divided by the sum of your cards' credit limits. A credit usage rate above 30% could negatively impact your scores. The average credit utilization rate for consumers with a score of 590 is 78.2%, per Experian. Credit usage is responsible for about 30% of your score.
Credit History
How long you’ve had credit accounts also impacts your credit score (making up 15% of your score). Generally, the longer your credit history, the higher your credit score. Also, creditors may look at how long it has been since you used a given credit account. So if you have older credit cards, it can be a good idea to use them occasionally (and pay them on time).
Types of Credit
A small but important factor that impacts your credit score is the credit mix you have; it makes up 10% of your score. Lenders like to see that you have different types of credit, both revolving (like credit cards) and installment (like a mortgage).
Recent Applications
If you apply for a new credit card or auto loan, that lender will check your credit, and that may show up on your credit reports as a hard inquiry. This can have a small, temporary effect on your score. Several inquiries into different types of loans or credit in a short period of time, on the other hand, may cause your score to noticeably dip.Getting prequalified for a credit card or loan, however, is known as a soft inquiry. Soft inquiries won't impact your score. Checking your own credit is also a soft inquiry and does not impact your credit score. Recent credit applications can account for up to 10% of your score.Recommended: Credit Score: What’s Involved in Calculating and Building Your Credit
Types of Credit Cards You May Be Able to Get With a 590 Credit Score
Credit card requirements vary depending on the issuer. If you have a 590 credit score, your credit card options may be limited, but you’re not necessarily out of luck. Here are some options you may be eligible for.
Secured Credit Cards
Applying for a secured credit card can be a good option if your credit is in the fair or poor zone. With a secured card, you’ll pay a security deposit upfront. This security deposit typically sets your credit limit. If you put $500 down, for example, you’ll likely have a credit limit of $500. This lowers risk for the card issuer, since they can seize your deposit should you stop making payments.A secured card also has benefits for cardholders. If your regular, on-time payments and credit usage get reported to the credit bureaus, it can have a positive impact on your credit score and could enable you to qualify for an unsecured card down the road.
Unsecured Credit Cards
If you have a fair credit score but can’t afford a security deposit, you may be able to qualify for an unsecured credit card. Just keep in mind that your choices will likely be limited and you may have to get a card with an annual fee. In addition, you could face high interest rates and a relatively low credit limit.
Store Credit Cards
Store credit cards are generally easier to qualify for than regular credit cards and may offer discounts and rewards to encourage you to shop at their store. Using a store card, and making your payments on time and in full, could help you build a positive credit history and improve it over time. Just beware: Interest rates can tend to be high, so you'll want to be careful not to carry a balance.
Tips for Monitoring Your Credit Score
As you work to improve your credit, it can be a good idea to keep tabs on your score and see how your efforts are paying off. You can often access your credit score for free by checking your bank or credit card statement or by logging on to your account. You can also get your score for free through Experian. Another way to keep tabs on your credit score is to sign up for a credit monitoring plan through one of the credit reporting companies. For a monthly fee, you can receive regular score updates, as well as alerts when there is any change to your score, a company makes a credit inquiry, or if there is any suspicious activity detected on your credit report.Recommended: 5 Steps for Checking Your Credit Score
The Takeaway
A 590 credit score can make it challenging to get approved for unsecured credit, which doesn’t require collateral or a security deposit. Nevertheless, it's a good starting point for building your credit. Working on getting your score into the “good” range (or, better yet, the “very good” range) could help you gain access to more credit options, lower interest rates, and reduced fees.If you’re interested in exploring credit card options for fair credit, Lantern by SoFi can help. With our online credit card marketplace, you can view multiple offers for credit-building cards all in one place and without making any type of commitment.
Frequently Asked Questions
Can I get approved with a 590 credit score?
How can I raise my credit score from 590?
Is 590 a good credit score?
Can I get a car loan with a 590 credit score?
Photo credit: iStock/Milan_Jovic
LNTCC-Q424-007
About the Author
Jason Steele
Jason Steele has been writing about credit cards and award travel since 2008. One of the nation's leading experts in this field, he has contributed to dozens of personal finance and travel outlets and has been widely quoted in the mainstream media.
