A credit score of 690 is in the good credit range. If you’re shopping for a personal loan and your credit score is that high, then you’re in good shape.
If you have a credit score of 690, lenders are more likely to approve your loan application. This does not guarantee approval as other factors come into play, including your income. That being said, a high credit score is a big plus in your favor, and 690 is well above the credit score you need for a personal loan.
You can also benefit from lower interest rates with this score, which makes a significant difference in the cost of your loan. Keep in mind that you may not qualify for the absolute lowest rates, as these are often only available to consumers with credit scores of at least 720 or 740.
To get the best possible deal for your credit score, here’s what you need to do before and during the application process.
Be sure to check your FICO® score
Before shopping for a loan, you should know that you are checking the right kind of credit score. There are two credit scoring systems:
Many free credit score tools you can find online provide your VantageScore. But over 90% of top lenders look at your FICO® score.
Your score can be very different in these two systems. For example, my FICO® score is typically 30-40 points lower than my VantageScore.
Use a free credit score tool that provides your FICO® score so you don’t end up with any unpleasant surprises when you apply for a loan. Two tools that provide your FICO® score are Discover® Credit Scorecard and Experian CreditWorksSM Basic.
Review your credit report
- Trans Union
Request credit reports from all three bureaus on AnnualCreditReport.com. You are legally entitled to a free annual report from each bureau, although you can currently receive a free weekly credit report until April 2022.
Verify the accuracy of your reports. If you notice errors in the credit report, go to the website of the office that issued it and file a dispute. Any mistake could lower your credit score. Having them removed can increase your score and help you get a lower personal loan interest rate.
Rate shopping involves checking your potential loan rates with multiple lenders, and it’s the most important part of applying for a loan. Even a small difference in your interest rate could save you a lot of money.
It’s much easier to assess purchases now that many lenders allow you to check rates online. Start by making a list of lenders with the best personal loan deals. It’s a good idea to check rates with at least five lenders.
Visit each lender’s site and choose the option to check rates. To provide rates, lenders usually only need to perform a soft credit check on you, which does not affect your credit score.
Here are the numbers to watch from each lender:
- Annual percentage rate (APR): This is the amount you will pay each year in fees. It includes the interest rate, origination fees and all other fees included in the loan. The APR is therefore a better way to assess the total cost of a loan than the interest rate alone.
- Duration of the loan and monthly payment: The loan term is how long you have to pay off your loan, and most personal loans have terms ranging from 12 to 60 months. If you go for a longer term, you’ll have a lower monthly payment, but you’ll also pay more interest overall.
Once you have the rates from all the lenders, you can choose one with a term and monthly payment that works for you at the lowest APR available.
Assuming you have a steady income, a credit score of 690 should be more than enough to qualify for a personal loan. If you have time on your hands, it may help to raise your credit score first. By increasing your score, you could benefit from lower rates and pay even less. But if you need a loan right away, you should still be able to get a reasonable interest rate with a score of 690.
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