So, you’ve got a credit score of 588. Now you’re left wondering if it’s good or bad. Lower numbers communicate to lenders that you’re a risky investment. This informs whether or not they approve you for loans or credit cards.
If your score falls below 619, FICO says you have “poor” credit. You’ll receive high-interest rates if approved at all. The best option? Understand the situation and work to improve it.
Credit Score of 588: Home Loans
Is it possible?
PROBABLY NOT — You need a credit score above 620 to secure a reasonable mortgage.
If you have a credit score of 588, you likely won’t get approved by most lenders. On the chance you do, expect to pay interest rates as high as 5-6%. Loans through the FHA (Federal Housing Administration) are your best bet, but it’s still a long shot.
Credit Score of 588: Car Loans
Is it possible?
YES — You can definitely buy a car with this score, but you’re going to pay for it.
Lenders may approve your application, but it’ll be accompanied by a high-interest rate. Honestly, it’s a good idea to wait on these loans and focus on raising your score.
Just 70 points make a huge difference…
In 2018, the average amount borrowed for an auto loan is $31,099. However, that number is just one half of the equation. To give you a better idea of how a high-interest rate affects you, let’s look at an example.
Below, you’ll see the 3 most common auto loans: 60-month, 48-month, and 36-month. For each type, there’s a comparison between someone with a credit score of 588 and 648.
|Loan Type||Credit Score||Annual Rate||Monthly Payment||Total Added Cost|
|36-month new auto||588||15.867%||$1,091||$2,986|
|48-month new auto||588||15.865%||$879||$4,080|
|60-month new auto||588||15.938%||$755||$5,266|
Credit Score of 588: Credit Cards
What’s the best credit card for a score of 588?
OPTIONS ARE OUT THERE — It’s difficult to get approved with a low score, but possible.
At 588, credit card companies see that you’re just shy of an average score. For this reason, you may be able to qualify for both secure AND unsecured cards.
Here are a few recommendations:
|Card Name||Annual Rate||Annual Fee||Secured/Unsecured|
|Credit One Bank Visa||17.49% – 25.49% (Variable)||$99||Unsecured|
|Milestone Gold Mastercard||23.90%||$35-$99||Unsecured|
|Open Sky Secured Visa||18.64% (Variable)||$35||Secured|
|Discover it® Secured Card||24.49% (Variable)||$0||Secured|
How To Improve A Credit Score of 588
Improving a credit score of 588 to something over 620 should become the main priority. Good credit makes so many things easier, and a bit of diligence will raise your score in no time.
For many, the process may feel overwhelming. Here are a few tips for getting started…
- Be smart when shopping for a loan. Don’t apply for several loans or credit card in a row, as this can hurt your score. Also, avoid getting in over your head with how much you owe.
- Payback your credit on time. Lenders like knowing that they’re going to get their money on-time, every time. If you show your ability to pay, the score will rise.
- Find someone to help you. If small improvements aren’t raising your score fast enough, consider getting some professional help from a credit repair company like Go Clean Credit.
You can do it!