A 524 Credit Score Is Clearly Very Low

A 524 credit score is classified by most credit bureaus and lenders as being a “Poor” score. According to Experian, approximately 16% of Americans have a score that is lower than 580, so it is fair to say that 524 likely puts you in the bottom 10% of American adults. Other credit models such as the VantageScore 3.0 would categorize a 524 score in the “Very Poor” category.transunion-credit-score-range

Credit scores are measures of the likelihood that a consumer is going to be delinquent on the credit that is extended to them, and so when credit reporting agencies like Experian and TransUnion categorize a 524 credit score as poor, they are in effect suggesting that the probability of lenders facing delinquency after providing credit to people in this category, is high. In fact, Experian estimates that 62% of customers with credit scores between 300 and 579 are likely to end up seriously delinquent. So clearly, a 524 credit score is not ideal. But there is good news – credit scores are not fixed and there are actions you can take to improve your score over time. In the following sections, we summarize the implications of a 524 credit score and outline some of the actions you can take to improve your score.

The Real World Implications of a 524 Credit Score

The reality of a 524 credit score is that it falls below the minimum credit scores for many types of credit. A score this low is often a sign that you have previously experienced credit difficulties, most likely due to falling behind on payments and allowing them to go past due for longer than 90 days. Alternatively, it may be a sign that you have no credit history, which means you have little evidence of having repaid a debt and therefore from a lenders point of view, extending credit to you is a higher risk. These are the implications for various types of credit.

Getting a mortgage with a 524 Credit Score

It is almost impossible to get approved for a mortgage with a 524 credit score – a mortgage is one of the largest amounts lenders will extend to consumers and also have long repayment periods, and with that comes very strict underwriting criteria. In 2021, 98% of the mortgages that were issued in the United States were to people that had a 620 credit score or higher. According to the Federal Reserve Bank of New York, the current average credit score for a successful mortgage application is 786. Further, even if you were to find a lender willing to provide you with a mortgage with your 524 credit score, the mortgage rate offered would be much higher than average to reflect the higher risk. Therefore, while getting a mortgage with a 524 credit score can be done, the odds of it happening are very low. In addition, it might not be the best idea to sign up to pay a high mortgage rate as that can put you at risk of delinquency, which would lead to a further degradation of your credit score.

Can You Get a Credit Card with a 524 Credit Score

Yes you can, but the options will be limited. You will be able to get approved for some credit cards with a 524 credit score, but these will most likely be non-traditional credit cards and secured credit cards. Typical credit cards are unsecured meaning that you don’t need to make a security deposit or post any form of collateral to use the card. As a result, lenders are taking a bigger risk by issuing an unsecured credit card to you, and so consumers with lower credit scores are viewed as riskier borrowers. Your best bet as far as unsecured credit cards goes might be non-traditional credit card options such as those issued by merchants (also known as “store cards”) would be an alternative for consumers with low credit scores. Examples of a merchant card would be the Lowe’s Advantage Card. Because these credit cards are issued and designed to encourage spending at the respective stores, there are additional considerations in their decision to approve a credit card application.

Can You Get a Personal Loan with a 524 Credit Score

Yes you can but the number of lenders will be limited and the rates may be high. Many personal loan providers advertise their rates and the ranges are high for a reason. The lower your credit score the higher the interest rate a lender will demand for providing you with a personal loan. For example, we estimate that SoFi charges typical annual percentage rates of 7% to 25% for personal loans while Lending Club charges rates of 6% to 36% for personal loans. These are clearly very wide ranges and the higher ends of the range reflect rates that rival credit cards! The point is, while it is still possible to get a personal loan with this score, it might not be at an interest rate that makes sense financially.

Is 600 a Good Credit Score? What is a Good Credit Score?

Given the starting point of a 524 credit score, your goal should be to get to a 600 credit score as soon as is reasonably possible. This is just a goal however. A 600 credit score is still not a great place to be in terms of your access to affordable credit. The average credit score in the United States is 711 according to Experian, so even a credit score of 600 remains well below this figure. This does lead to an important question: what is a good credit score? We consider a 750 credit score to be a good credit score. In our view a good credit score is high enough to allow you to get approved for most forms of credit extension. With a 750 credit score not only are you comfortably above the average credit score in the United States, but when it comes to getting approved for a mortgage (the gold standard of credit approvals) your score places you above the median. This means that your odds of being approved for a mortgage with a 750 credit score are very good. With a 750 credit score you will also be eligible for most credit cards, personal loans and auto loans with attractive features and rates.

Steps You Can Take To Improve From a 524 Credit Score

Because you’re starting from one of the lowest categories of credit scores, it’s important to start implementing strategies and habits that can help improve your credit score over time. The following are some of the steps you can take:

  • Get Copies of Your Credit Reports: the first step we’d recommend would be to obtain a copy of your credit reports from each of the credit bureaus (Experian, TransUnion and Equifax) and review them thoroughly to first ensure that all the information on the reports is accurate. It is very important to understand what happened that resulted in your score falling to this level. Every consumer is entitled by law to a free copy of their credit report from each of the three credit bureaus once a year. You can do this by visiting the Annual Free Credit Report. If you notice that there are irregularities on your credit report, you can act by sending a letter to the relevant credit reporting company disputing the information. Viewing your credit reports will also provide you with an idea of what has impacted your score in the past such as late payments and delinquent accounts. You can find more information about disputing information on your credit reports here:
  • Pay Down Revolving Credit – You should prioritize reducing revolving debt such as credit cards which has two benefits. First, these types of accounts impact your credit utilization ratio which is an important determinant of your credit score. The second benefit is that credit debt is also more expensive than other forms of debt, so you save more by reducing it first.
  • Avoid Hard Inquiries: You should also avoid having new hard inquiries made on your accounts. These inquiries are typically the result of new applications for credit. Hard inquiries result in your credit score going down and aside from that it can be a concerning signal to existing lenders that view your credit report. Moreover, as the priority should be on debt reduction, limiting hard inquiries should be an easy way to avoid lowering your score further. This table is a helpful tool for remembering which activities lead to hard inquiries and which lead to soft inquiries. The latter does not impact your credit score.


  • Prioritize Paying Your Bills On-time – not making your payments on your outstanding credit or making late payments is an easy way to impact your credit score. Your payment history is responsible for 35% of your credit score and so having a poor payment history is one of the common causes of low credit scores. A good practice that is easy to implement is to enroll in auto-pay for not just your credit repayments but other bills. Doing this at least helps you significantly lower the risk that you forget to make a payment and end up becoming delinquent.
  • Take Advantage of Credit Building Tools – having a 524 credit score limits your options for new loans but at the same time, you need opportunities to demonstrate to lenders that you are creditworthy. This is where credit building tools can be very valuable. These tools exist specifically to allow consumers with limited or poor credit histories to start rebuilding their credit. A common tool is a secured credit card. These cards are offered by many banks, do not require a credit check for approval in most cases, and are an effective way of re-establishing credit worthiness.
  • Monitor Your Credit Reports Closely – finally, it is a good idea to pay close attention to your credit scores. Checking your credit reports once a year should be the minimum frequency as while the information might not change every day, over the course of a year a lot can change. Monitoring your credit reports monthly (what we would recommend) allows you to keep track of the progress you’re making in improving your credit scores and enables you to be proactive in the event that an issue arises. There are a host of free credit monitoring tools including Credit Karma and Credit Wise.

It is Possible to Recover From a 524 Credit Score

No one wants to be in a category or grouping that is labelled as “Poor” or “Very Poor”. This is especially the case when it is related to something as important as your credit score. A 524 credit score is problematic not just in limiting your access to credit but also in terms of affordability as most of the credit options will be more expensive than normal. It’s never too late to start enacting changes. Employing these best practices, limiting new accounts and reducing debt will all contribute to your score recovering over time.

Similar Credit Scores: 300, 400, 500, 515, 527, 534, 546, 552, 560, 575, 585, 598