Is a 591 Credit Score Bad? What It Means & How to Fix It

A credit score is a numerical representation of an individual’s creditworthiness, providing lenders with a quick assessment of risk. This three-digit number is a vital component in various financial transactions, influencing loan approvals and interest rates. Understanding your credit score is fundamental to navigating the financial landscape. It summarizes your past borrowing and repayment behaviors for potential creditors.

Understanding Credit Scores and Ranges

A credit score evaluates an individual’s likelihood of repaying borrowed money. It distills financial histories into a single number to help lenders make informed decisions. Several key factors contribute to this score. Payment history is often the most influential component, indicating whether past debts were paid on time. The amount of debt owed, particularly the credit utilization ratio (credit used against total available credit), is another significant factor.

The length of credit history, reflecting how long accounts have been open, also plays a role. The credit mix, or variety of credit accounts like credit cards, installment loans, and mortgages, and new credit applications (indicated by hard inquiries), contribute to the overall score. The two most prevalent credit scoring models in the United States are FICO Score and VantageScore, both typically ranging from 300 to 850.

Scores are generally categorized into distinct ranges to denote different levels of credit risk. For FICO Scores, 300-579 is typically considered “Poor,” 580-669 is “Fair,” 670-739 is “Good,” 740-799 is “Very Good,” and 800-850 is “Exceptional.” VantageScore models have slightly different classifications: “Poor” (300-600), “Fair” (601-660), “Good” (661-780), and “Excellent” (781-850). These ranges provide a framework for lenders to assess risk and determine the terms of credit offered.

What a 591 Credit Score Means for You

A 591 credit score generally falls into the “Fair” or “Poor” category, depending on the credit scoring model used. Under the FICO model, a 591 score is “Fair.” With the VantageScore model, it is typically “Poor.” This indicates to lenders that a borrower may present a higher risk of defaulting on financial obligations.

The implications of a 591 credit score are substantial across various financial products. For personal loans, individuals with this score may face significantly higher interest rates, potentially up to 35.99 percent, and may be limited in borrowing amounts or offered shorter repayment terms. Lenders perceive a low score as a greater risk and adjust their terms to mitigate potential losses.

For auto loans, a 591 score often translates to higher annual percentage rates (APRs), potentially 10-15% or more, compared to rates for borrowers with better credit. This increased interest can add thousands of dollars to the total cost of a vehicle. Obtaining a mortgage with a 591 score can be challenging, as many conventional lenders prefer scores of 620 or higher. While some government-backed loans might be accessible, interest rates will be considerably higher, significantly increasing the overall cost of homeownership.

Credit card options are also limited. Many standard unsecured credit cards may be out of reach, necessitating secured credit cards that require a cash deposit as collateral. These cards typically come with lower credit limits and may still carry higher annual fees or interest rates. Beyond traditional lending, a lower credit score can impact rental applications, where landlords may view it as an indicator of financial instability, or lead to higher security deposits for utilities or increased insurance premiums.

Strategies for Improving a Credit Score

Improving a credit score like 591 involves consistent effort and positive financial habits. A primary strategy is to consistently make payments on time, as payment history is the most heavily weighted factor in credit scoring models. Even a single late payment can negatively impact a score and remain on a credit report for up to seven years, though its influence diminishes over time. Setting up automatic payments helps ensure bills are paid promptly.

Another effective approach involves reducing credit utilization, the amount of revolving credit used compared to total available credit. Financial experts generally recommend keeping this ratio below 30% to demonstrate responsible credit management; a lower ratio is often viewed more favorably by scoring models. Paying down credit card balances or requesting a credit limit increase can help lower this ratio. Avoid closing older credit accounts, as this can reduce total available credit and shorten credit history, negatively affecting the score.

Regularly checking credit reports from all three major bureaus—Equifax, Experian, and TransUnion—is important to identify and dispute inaccuracies. Errors, such as incorrect late payments or accounts that do not belong to you, can unfairly lower a score. Consumers are entitled to a free copy of their credit report from each bureau annually. Disputes can be initiated online, by phone, or by mail, with bureaus typically having 30 days to investigate.

While opening new credit can temporarily cause a small dip in score due to a hard inquiry (which remains on a report for up to two years but typically impacts the score for only 12 months), maintaining a healthy credit mix can be beneficial. Having a variety of credit types, such as installment loans and revolving credit, demonstrates an ability to manage different forms of debt responsibly. Strategically adding a new type of credit, such as a secured credit card to build history, can be a valuable step for those with lower scores.