A credit score below 580 is generally considered low, falling into the “Poor” category on the FICO scoring model. FICO scores range from 300 to 850, and anything in the 300 to 579 range signals to lenders that you’re a higher-risk borrower. That designation affects your ability to get approved for loans and credit cards, and it raises the interest rates you’ll pay when you do qualify.
Where the Cutoff Falls
The most widely used scoring model is FICO, which groups scores into tiers. A score of 300 to 579 is rated “Poor,” while 580 to 669 is considered “Fair.” Both VantageScore and FICO use the same 300 to 850 range, though their internal category labels differ slightly. For practical purposes, most lenders treat anything below 580 as a red flag, and scores in the low 600s still carry meaningful disadvantages compared to scores of 670 and above.
Your score isn’t a single fixed number. Each of the three major credit bureaus (Experian, Equifax, and TransUnion) may have slightly different data in your file, which means your score can vary depending on which report a lender pulls. A 10 to 20 point difference between bureaus is normal.
What a Low Score Costs You
The most immediate impact of a low score is higher interest rates. On credit cards, the gap might seem modest in percentage terms but adds up fast. New cardholders with scores of 619 and below paid an average APR of 30.0% in 2024, compared to 27.3% for borrowers with scores between 740 and 759. On a $5,000 balance carried for a year, that roughly 3 percentage point difference translates to about $135 in extra interest charges.
The cost gap widens dramatically on larger loans. Mortgage and auto lenders use credit scores to set both approval decisions and pricing tiers. A borrower with a 580 score who qualifies for an FHA mortgage might pay a rate a full percentage point or more above what a 740-score borrower receives on a conventional loan. Over 30 years on a $250,000 mortgage, even a single percentage point difference in rate can mean $50,000 or more in additional interest paid.
Beyond rates, a low score can mean higher security deposits from utility companies, difficulty renting an apartment, and limited options for cell phone plans. Some employers in finance-related fields also review credit reports during the hiring process.
How a Low Score Affects Loan Eligibility
Different loan programs draw hard lines at specific scores. For mortgages, the thresholds look like this:
- Conventional loans require a minimum 620 credit score.
- FHA loans accept scores as low as 500, but borrowers with scores between 500 and 579 must put down at least 10%. A score of 580 or higher qualifies for the standard 3.5% minimum down payment.
- VA loans have no official minimum score set by the government, though most VA-approved lenders require at least 620.
- USDA loans also lack a government-mandated minimum, but lenders typically require a 640 or higher.
For auto loans, there’s no universal minimum score. Subprime auto lenders will work with borrowers in the 500s, but the interest rates can reach 15% to 20% or higher. Many mainstream auto lenders prefer scores of at least 620 to 660 for competitive rates.
Why Scores Drop Low
FICO calculates your score from five weighted factors, and the two heaviest ones are usually what drag scores into the “Poor” range.
Payment history makes up 35% of your score, making it the single most influential factor. Even one payment reported 30 or more days late can cause a significant drop, and the damage compounds with each additional missed payment. Collections accounts, bankruptcies, and foreclosures all fall under this category and can push a score deep into the 500s or below.
Amounts owed accounts for 30% of your score. This factor is largely driven by your credit utilization ratio: how much of your available credit you’re currently using. If you have a $5,000 credit limit and carry a $4,500 balance, your 90% utilization signals to the scoring model that you may be overextended. Keeping utilization below 30% helps, and single-digit utilization is ideal.
The remaining factors are length of credit history (15%), new credit inquiries (10%), and credit mix (10%). A thin or short credit file, meaning you have few accounts or only recently opened your first one, can keep scores low simply because there isn’t enough data to demonstrate reliable borrowing behavior. Opening several new accounts in a short period also hurts, since each application generates a hard inquiry and lowers your average account age.
How to Move Out of the Low Range
Improving a low score takes consistent effort over months, not days, but some actions produce faster results than others.
Paying down high balances is often the quickest lever you can pull. Because utilization updates on your credit report each billing cycle, reducing a maxed-out card balance from $4,500 to $1,500 could improve your score noticeably within 30 to 60 days. If you can’t pay down balances all at once, focus on the cards with the highest utilization percentages first.
Setting up autopay for at least the minimum payment on every account prevents new late payments from piling on. If you already have late payments on your record, their impact gradually fades. A single 30-day late payment has much less scoring influence after 12 to 24 months, though it remains on your report for seven years.
If you have a very thin file, a secured credit card (where you put down a refundable deposit that serves as your credit limit) can help build a positive payment history from scratch. Some credit unions also offer credit-builder loans designed specifically for this purpose. In both cases, the lender reports your on-time payments to the bureaus, which steadily adds positive data to your file.
Checking your credit reports for errors is worth doing early in the process. Incorrect late payments, accounts that don’t belong to you, or balances reported at the wrong amount can all suppress your score. You can dispute errors directly with each bureau at no cost through AnnualCreditReport.com.