A bad credit score is usually anything below 580 on the standard 300–850 scale

Most lenders treat scores below 580 as high-risk. At that level, you will face higher interest rates on loans and credit cards, larger security deposits on rental applications, and outright rejection from mainstream lenders. Some lenders have their own cutoffs — a bank might decline you at 620, while a credit union might work with you at 600. The exact number that matters depends on what you are trying to borrow or rent.

The three major credit bureaus (Equifax, Experian, and TransUnion) all use the same 300–850 scale, so your score should be similar across all three. However, each bureau may have slightly different information about you, which means your score can vary by 10 to 50 points depending on which report a lender pulls. You can check your own score for free once per year at annualcreditreport.com, which is the official government site.

Key Takeaways

  • Scores below 580 are considered bad by most lenders and will result in higher interest rates or loan rejection.
  • Your score comes from payment history (35%), amounts owed (30%), length of credit history (15%), credit mix (10%), and new credit inquiries (10%).
  • Late payments, high credit card balances, and collections accounts are the fastest ways to damage your score.
  • You can obtain your free credit report once per year from annualcreditreport.com and dispute errors directly with the bureau that reported them.

How credit scores break down into ranges

The 300–850 scale divides into five broad ranges that lenders use to make decisions. A score of 300–579 is considered poor or bad. A score of 580–669 is fair — you may get approved but at higher rates. A score of 670–739 is good, and most mainstream lenders will work with you. A score of 740–799 is very good, and you will see better rates. A score of 800–850 is excellent, and you get the best terms available.

Where you fall in the bad range matters. A 550 and a 579 are both bad, but a lender may turn down the 550 outright while offering the 579 a subprime credit card or auto loan at a much higher rate. The difference between 579 and 580 can mean the difference between rejection and approval, even though both are considered bad credit.

What damages your score the most

Payment history is the single largest factor in your score — it accounts for 35% of the calculation. A single late payment (30 days or more past due) can drop your score by 100 points or more, depending on how recent it is and how high your score was before. A payment that goes to collections or results in a judgment is even worse and can stay on your report for seven years.

The second-largest factor is how much credit you are using compared to your limits — called your utilization ratio, which counts for 30%. If you have a $1,000 credit limit and carry a $900 balance, your utilization is 90%, which damages your score significantly. Even if you pay on time, high balances hurt you. Paying down balances to below 30% of your limit can improve your score noticeably within a few months.

The remaining factors — length of credit history (15%), credit mix (10%), and new credit inquiries (10%) — matter less individually but add up. Closing old accounts, applying for multiple new credit cards in a short time, or having only one type of credit (like only credit cards, no installment loans) all work against you.

How to check your own score and report

You are may have access to to one free credit report per year from each of the three bureaus. Go to annualcreditreport.com (not creditreport.com or other similar sites) and request your report. You can pull all three at once or space them out across the year to monitor changes. The site will ask you to verify your identity and then show you what each bureau has on file.

Your free report does not include your score — it shows only the accounts and payment history that make up your score. To see your actual score, you can use free tools like Credit Karma or NerdWallet, which update monthly and show you scores from at least two of the three bureaus. These free tools use educational scores, which are calculated the same way as the scores lenders see but may differ slightly from the official score a lender pulls.

When you get your report, look for errors: accounts you did not open, payments marked late that you made on time, or duplicate entries. If you find an error, contact the bureau that reported it in writing (email or certified mail) and describe the mistake. The bureau must investigate within 30 days and remove the error if it cannot verify it.

Why bad credit affects more than just loans

A bad credit score affects you beyond borrowing. Landlords often pull credit reports as part of rental screening and may reject you or charge a higher security deposit if your score is low. Some employers check credit reports for certain jobs (though not all states allow this). Utility companies may require a deposit if your score is poor. Insurance companies in some states use credit-based insurance scores to set your rates.

The impact varies by location and industry. Some landlords focus only on eviction history and ignore credit scores entirely. Others use credit as a primary screening tool. If you have a bad score and are renting, be prepared to explain late payments or collections accounts, offer a co-signer, or pay a larger deposit upfront.

Steps to rebuild a bad credit score

Rebuilding takes time, but the process is straightforward. First, stop the damage: pay every bill on time from now on, even if it is just the minimum. One on-time payment does not fix a bad score, but one late payment makes it worse. Second, pay down credit card balances to below 30% of your limits if possible. This change shows up in your score within one or two billing cycles.

Third, do not close old accounts or apply for new credit unless you need it. Every new application triggers a hard inquiry, which temporarily lowers your score by a few points. Fourth, if you have accounts in collections, consider negotiating a settlement or payment plan. Paying off a collection account does not remove it from your report, but it changes the status and may help your score slightly.

Fifth, if you have no credit history or very little, consider a secured credit card. You deposit money with the card issuer, and they give you a credit line equal to your deposit. Use it for small purchases and pay the full balance every month. After 6 to 12 months of perfect payment history, many issuers will convert it to a regular card and return your deposit.

How long bad credit stays on your report

Late payments stay on your credit report for seven years from the date you first missed the payment. Collections accounts also stay for seven years. Judgments and tax liens can stay longer — up to ten years or more depending on your state. Bankruptcy stays for seven to ten years depending on the chapter.

The good news is that the impact of negative items fades over time. A late payment from six years ago hurts your score far less than one from six months ago. Lenders weight recent history more heavily. If you have a bad score now because of old problems, rebuilding with on-time payments for the last year or two can move you into fair or good territory, even if the old items are still on your report.

Frequently Asked Questions

Can I get a loan with a bad credit score?

Yes, but you will pay more for it. Subprime lenders, credit unions, and some online lenders work with bad credit scores, usually charging 15% to 30% interest or higher on personal loans. Auto loans and mortgages are also available but at rates significantly higher than borrowers with good credit receive. Compare offers carefully, as rates vary widely.

Does checking my own credit score hurt it?

No. Checking your own score or pulling your own credit report is a soft inquiry and does not affect your score. Only hard inquiries — when a lender pulls your report because you applied for credit — lower your score slightly. You can check your score as often as you want without penalty.

How much will paying off a collection account improve my score?

Paying off a collection account does not remove it from your report, but it changes the status from unpaid to paid, which helps your score somewhat. The improvement is usually modest — 10 to 50 points depending on how recent the account is and what else is on your report. The account itself stays for seven years, but its impact decreases over time.

What if I disagree with something on my credit report?

Contact the bureau that reported it in writing and explain the error. Include copies of any documents that support your claim (payment receipts, statements, etc.). The bureau must investigate within 30 days and remove the item if it cannot verify it. If the bureau disagrees with you, you can add a statement to your report explaining your side.

Will my bad credit score ever disappear?

Your score itself does not disappear, but negative items do. Late payments fall off after seven years, collections after seven years, and judgments after seven to ten years depending on your state. Once old items drop off, your score will improve. In the meantime, new on-time payments build a better recent history that lenders see first.