Is 616 a Good Credit Score?

By Kim Franke-Folstad

A 616 credit score isn’t good or bad, though it is at the lower end of what is considered the “fair” range using the FICO® credit scoring model. That might make it more challenging for a borrower to get approved for a credit card or loan or to qualify for lower rates and fees.

Read on for a look at what you can expect with a 616 credit score.

What Does a 616 Credit Score Mean?

Typically, a credit score must be near or slightly above the average for U.S. consumers to be considered “good.” Using the popular FICO scoring model, that’s anywhere from 670 to 739. A FICO Score in the 580 to 669 range is generally categorized as fair. And a score that’s lower than 580 is “poor.”

Keep in mind, though, that it’s up to each lender to decide how it will assess credit scores, and lenders have multiple scoring models to choose from.

Some lenders may look at a 616 credit score as a bit of a red flag — a sign that you may have had some past credit problems or perhaps lack a credit history. They’ll consider you to be more of a risk than a borrower with a higher credit score.

But that doesn’t mean you won’t stand a chance when you apply for a loan or credit card. If you have other factors working for you — say, a low debt-to-income (DTI) ratio, solid employment and a good income, cash in the bank, or other assets — you still may qualify. Some credit cards and loans are designed to work for borrowers with fair or poor credit. But you may be asked to pay a higher interest rate or to secure the loan with some type of collateral.

What Can You Get with a 616 Credit Score?

You may have a harder time qualifying as a borrower with a credit score that’s on the borderline between fair and poor, but there are options available.

Can I Get a Credit Card with a 616 Credit Score?

With a 616 credit score, you might have a better chance of qualifying for a secured credit card vs. an unsecured credit card. But that isn’t necessarily a bad thing: Using a secured card can be helpful as you work to improve your credit reputation.

A secured card works pretty much like a traditional credit card, except that you’ll have to put down a deposit that “secures” the card. The credit card company will hold onto your money just in case you default on your payments, but you’ll get the deposit back if you close your account or if you transition to an unsecured card later on. Your credit limit with a secured card is usually the same as your deposit.

Whether you qualify for a secured or unsecured card, it’s likely that your interest rate and other costs will be on the high end until you can improve your creditworthiness. So it’s important to compare offers, preferably using a preapproval tool, so you’ll have a good idea as to whether you’ll get the card or not before you actually apply.

Remember to look for cards that come with useful credit-building elements, such as free credit score monitoring and/or an app that makes it easy and convenient to track your spending and saving.

It’s also important to be sure the credit card you choose regularly reports to all three of the major credit bureaus.

Can I Get an Auto Loan with a 616 Credit Score?

The minimum credit score required to get an auto loan can vary. And lenders may use an industry-specific scoring model for auto loans that works a little differently than your basic credit score. But as with most types of borrowing, the higher your score, the more likely you are to receive better financing terms.

Coming up with a higher down payment or getting a cosigner may help you get a loan and/or a better annual percentage rate (APR). Both moves can make you a lower risk for lenders. But with a 616 score, you can expect to get an APR that’s at least a few percentage points higher than car buyers with credit scores in the next highest range.

If you’re wondering if it’s smarter to buy a new or used car, there are pros and cons to both. Though it may seem counterintuitive, it actually may be easier to get financing for a new car, because it can be more difficult for lenders to accurately value a used car. But a used car is likely to have a lower price that’s easier on your budget.

Can I Get a Mortgage with a 616 Credit Score?

Requirements can vary with different types of mortgages, and lenders may have their own credit score requirements as well. Here are some basics to know:

•   If you’re applying for a conventional mortgage loan — a loan from a private lender that isn’t insured by a government agency — you typically will need a credit score of at least 620.

•   Lenders also like to see a minimum credit score of 620 for a VA loan, which is backed by the U.S. Department of Veterans Affairs. However, some lenders will accept a score as low as 580.

•   With a government-insured FHA loan, you’ll need a minimum 580 credit score to qualify for a down payment as low as 3.5%. Applicants with lower scores, down to 500, must put down at least 10%.

•   Considering a government-backed USDA loan? A minimum score of 640 is recommended, though borrowers without a credit history may be evaluated through other criteria.

Though a 616 credit score is below the preferred minimum for most of these loan types, you may want to talk to a mortgage professional about whether you could qualify and what option might be right for you. If you have stable employment, a low DTI ratio, and other positive information on your application, you might have a better chance of getting the type of loan you want. But you should be prepared to pay a higher interest rate than you would if you had a better credit score.

Can I Get a Personal Loan with a 616 Credit Score?

There are personal loans that are geared specifically to borrowers with fair or poor credit scores. This means you probably can find a lender who will approve your application with a 616 credit score, especially if the loan is in a lower amount and/or you’re willing to pay a higher interest rate.

One option to consider, if you have an asset that you’re willing and able to put up as collateral, is a secured personal loan. With this type of loan, the lender is taking less risk, which may make qualifying easier. And the interest rate may be lower than with an unsecured personal loan.

The overall cost of borrowing is key when you’re considering a personal loan. Credit cards are convenient and useful for smaller, everyday amounts or purchases that might earn points. But even unsecured personal loans tend to have lower interest rates than credit cards, which can make them a good choice for larger expenses. And knowing you’ll have a fixed payment to make every month can help you stay disciplined and on track.

Wondering how a personal loan might compare to other financing options? A personal loan calculator can help you determine how much your monthly payments might be, and if you could save by using a personal loan to pay off an existing loan or high-interest credit card balance.

You also may find it makes sense to use a credit card consolidation loan to simplify your finances and help you save money.

The Takeaway

A 616 credit score may not be considered “good,” but it is a good start if you’re trying to build or rebuild your credit reputation.

You may find that you’ll have to pay a higher interest rate when you borrow than you would if you had a higher score. But if you consistently pay bills on time — and use the tools available to help you keep improving your credit score — you can likely expect to qualify for better financing options down the road.

Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. Checking your rate takes just a minute.

SoFi’s Personal Loan was named NerdWallet’s 2024 winner for Best Personal Loan overall.

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FAQ

Is 616 a bad credit score?

A 616 credit score is neither good nor bad. It’s considered on the lower end of “fair,” according to the FICO scoring model. And it’s lower than the average U.S. credit score of 717.

Can I buy a house with a 616 credit score?

Generally speaking, you need a credit score of at least 620 to qualify for a mortgage loan. However, some lenders may offer loans to borrowers with a score as low as 500. A mortgage professional can help you determine the option that best fits your situation.

What can I get with a 616 credit score?

A 616 credit score is considered fair. You might qualify for secured credit cards, personal loans, or even a mortgage, though you’ll likely need to pay higher interest rates and fees.