NEW YORK (MainStreet) — It's the three-digit number that can make or break your ability to get a home loan, an apartment or even a job. But as Long Island debt consolidation attorney Leslie Tayne points out, "You can have a 750 credit score and not have 50 cents in the bank." So what does your credit score actually mean? What is a single point? And who decided that the major factors involved in formulating your credit score were what reflected who you are as a consumer?
Does a Single Point Mean Anything?
"I don't think anyone who is going to get approved at 620 will get turned down at 619," said Mike Sullivan, director of education with Take Charge America, a nonprofit credit counseling agency.
Generally speaking, a one-point difference isn't going to make or break the possibility of a loan approval; nor will it make an appreciable difference in the interest rate you receive.
"I don't think there's much chance of you getting a better rate even if you're just one point off," he says.
Of course, Sullivan says that for certain mortgage products such as FHA loans, it's not even up to the lender. The rules are the rules are the rules, and if you're off by so much as one point from the required threshold, you’re just not going to get approved for that loan. In that sense, a single point can be of make-or-break significance.