Credit Repair

640 Credit Score: Is this a Good or Bad Credit Score?

A 640 credit score on the FICO score scale of 300-850 is considered fair. People with this credit score may be considered subprime borrowers and may be offered higher interest rates or less ideal terms for credit cards and loans.

How to Improve Your 640 Credit Score

Your FICO score from Experian includes a list of individual factors that are having the biggest impact on your credit score. To improve your credit score, work on these personal factors first.

Credit Score Factors

To improve your credit score, it can help to understand the factors that affect it most:

  • Payment History: Paying your credit card bills and making loan payments on time will positively impact your credit score. Missing payments, making late payments, or paying less than the minimum payment can hurt your credit.
  • Credit Utilization Rate: Try to keep your credit utilization ratio low, ideally below 30%. You can calculate your credit utilization rate, sometimes called your balance-to-limit ratio, by adding the balances on all of your credit cards and revolving credit accounts, then dividing by your total credit limit. If you owe $4,000 on your credit cards and have a total credit limit of $10,000, then your credit utilization rate is 40%. You can improve your credit utilization rate by paying down your credit card balances.
  • Total Debt: Having a high amount of debt (the sum of your credit card balances and loans) can negatively impact your credit score.
  • Credit History and Mix: Credit scores consider the type of debt you have (such as credit cards and loans) along with how long you’ve had it. Using a variety of credit accounts over a long period of time can improve your credit score.
  • Public Information: Some public information, including bankruptcies, tax liens, and civil judgments, can appear on your credit report and harm your credit score.
  • Hard Inquiries: Hard inquiries appear on your credit report when you apply for new credit and can negatively impact your credit score. (Checking your own credit is a soft inquiry and does not impact your credit score.)

Dealing with Negative Information on Your Credit Report

Having negative information on your credit report, such as late payments, civil judgments, or too many hard inquiries, can make it more difficult to get approved for credit cards and loans with favorable rates and terms. The good news is that this negative information will be automatically removed from your credit report after a set time period.

  • Late Payments and Past Due Accounts: Late payments will remain on your credit report for seven years after the original delinquency date, which is when the account first became delinquent, or past due.
  • Collection Actions: Collections are considered continuations of the original debt, so they will also be deleted seven years from the original delinquency date of the original account, which is when the account first became past due.
  • Hard Inquiries: Hard inquiries occur when you apply for new credit. They remain on your credit report for two years, though they impact your credit score less and less as time passes. Checking your own credit will not impact your credit score.
  • Bankruptcies: Bankruptcies remain on your credit report from seven years (if you file Chapter 13 bankruptcy) to ten years (if you file Chapter 7 bankruptcy) and can significantly harm your credit scores.
  • Court Judgments: A civil court judgment will be removed from your credit report after seven years from the filing date. When you pay the judgment amount, your credit report will be updated to reflect the status, but the notation of the judgment will remain for the full seven years.
  • Tax Liens: If paid, a tax lien cycles off your credit report seven years after the filing date. If unpaid, the tax lien will remain on your credit report for ten years from the filing date.

You can begin rebuilding your credit by ensuring all the information on your credit report is accurate. If any information is inaccurate, you may file a dispute. If negative information is accurate, you won’t be able to have it removed from your credit report until it cycles off. Meanwhile, you can take actions to improve any poor credit habits that caused the negative information to appear on your report in the first place.

  • You can’t erase a late payment, but bringing any overdue account current can have a positive effect on your credit scores.
  • Likewise, pay any tax lien or court judgments per the court’s guidelines for repayment.
  • Work with collection agencies and original creditors to clear up any collection actions against you.
  • Refrain from applying for new lines of credit until your credit standing improves.
  • Continue paying all your other bills on time, including credit cards, auto loans, and student loans.
  • Pay down any outstanding credit card debt as quickly as possible.

Time can help heal your credit scores. The impact of some types of negative information fades over time, and all negative items will eventually cycle off your credit report. While you’re waiting for negative information to expire from your report, you can continue to build your positive credit history by bringing accounts current and paying all bills on time. Good credit behaviors today mean that when all your negative information expires, all that will be left in its place is a record of how you’ve used credit successfully, and you’ll be rewarded with improved credit scores.


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