Credit 620: What It Means and How to Improve It

A credit score of 620 sits right on the edge of what many lenders consider "fair" credit. While it’s not terrible, it’s also not great—and in today’s economy, where interest rates are high and lending standards are tightening, a 620 score could mean the difference between qualifying for a loan or getting denied.

Whether you're trying to buy a home, finance a car, or even secure a decent credit card, understanding what a 620 credit score means—and how to improve it—is crucial.

Why a 620 Credit Score Matters

The Current Economic Landscape

Inflation, rising interest rates, and economic uncertainty have made lenders more cautious. A few years ago, a 620 FICO score might have been enough to secure a mortgage with a reasonable rate. Today, many lenders require at least a 640 or higher for conventional loans.

Credit scores are divided into ranges:
- Poor: 300-579
- Fair: 580-669
- Good: 670-739
- Very Good: 740-799
- Excellent: 800-850

At 620, you’re in the lower end of "fair," which means you may still qualify for loans but at higher interest rates.

How Lenders View a 620 Score

Lenders see borrowers with 620 scores as higher-risk. This can lead to:
- Higher interest rates on loans and credit cards
- Larger down payment requirements
- Fewer loan options (some lenders may outright deny applications)
- Higher insurance premiums in some states

How to Improve a 620 Credit Score

1. Pay Down Credit Card Balances

One of the fastest ways to boost your score is by lowering your credit utilization ratio—the amount of credit you’re using compared to your total available credit. Experts recommend keeping this below 30%, but ideally under 10% for the best impact.

Action Steps:
- Pay more than the minimum due each month.
- Avoid maxing out cards—even if you pay them off in full.
- Request a credit limit increase (without spending more).

2. Dispute Errors on Your Credit Report

Mistakes happen—and they can drag your score down. A 2021 FTC study found that 1 in 5 consumers had errors on their credit reports.

How to Fix Errors:
- Get free reports from AnnualCreditReport.com.
- Dispute inaccuracies with Equifax, Experian, and TransUnion.
- Follow up until corrections are made.

3. Avoid New Credit Applications (For Now)

Each hard inquiry from a lender can drop your score by a few points. If you’re at 620, multiple applications in a short time could push you into the "poor" range.

Exceptions:
- Rate shopping for mortgages or auto loans within a short window (typically 14-45 days) counts as a single inquiry.
- Pre-approvals that use soft pulls won’t hurt your score.

4. Become an Authorized User

If you have a trusted family member or friend with good credit, ask if they’ll add you as an authorized user on their oldest credit card. Their positive payment history could help your score—as long as they use credit responsibly.

Warning: This only works if the primary user pays on time. Late payments will hurt both of you.

5. Use a Credit-Builder Loan

If you have little credit history or past mistakes, a credit-builder loan can help. These loans (offered by credit unions and some banks) hold the borrowed amount in an account while you make payments. Once paid off, you get the money—and a boost to your credit.

6. Set Up Payment Reminders

Payment history is 35% of your FICO score. Even one late payment can cause a significant drop.

Tips to Stay on Track:
- Enable autopay for at least the minimum payment.
- Use calendar alerts or budgeting apps like Mint or YNAB.
- Contact lenders before missing a payment—some offer hardship programs.

The Long-Term Game: Building Better Credit Habits

Improving from 620 to 700+ doesn’t happen overnight, but with consistent effort, it’s achievable.

Monitor Your Progress

• Use free tools like Credit Karma or Experian Boost to track changes.
• Check your FICO score (not just VantageScore) since most lenders use FICO.

Diversify Your Credit Mix

Having a mix of credit cards, installment loans, and mortgages (if possible) can help—but only if you manage them well.

Patience Pays Off

Negative marks (like late payments or collections) lose impact over time. Most drop off after 7 years, and their effect diminishes each year.

Final Thoughts

A 620 credit score isn’t a dead end—it’s a starting point. By taking strategic steps today, you can open doors to better rates, more financial opportunities, and greater peace of mind in an unpredictable economy.