What Is Considered a Fair Credit Score?

Those who have a "fair" credit score often feel one of two ways. You might feel optimistic because your next step up the credit ladder is "good" credit. Or you might take a more pessimistic viewpoint and feel just a bit too close to the "poor" credit range. I want you to look up the ladder, not down.

A fair credit score isn't ideal, of course, but it's perfectly respectable. It's subprime by most standards, so you won't get rewarded with the best interest rates. But when you're in the fair credit range, think of it as a necessary pit stop. Your next destination? Good credit.

There are way too many credit score versions out there, so let's just focus on the two most important ones: FICO Score 8 and VantageScore 3.0. FICO Score 8 is used most often by lenders, so let's take a look at that one first.

[Read: Best Credit Cards for Fair Credit.]

Fair Credit and FICO Score 8

FICO Score 8 ranges from 300 to 850. According to myFICO.com, these are the values for each credit score range:

-- Exceptional: 800+

-- Very good: 740 to 799

-- Good: 670 to 739

-- Fair: 580 to 669

-- Poor: 579 and lower

The average FICO score as of April 2018 is 704. Since a fair credit score is from 580 to 669, your score is below average.

A fair credit score means that lenders view you as having a medium-high risk of delinquency. Around 28% of consumers with fair credit scores are likely to become delinquent, FICO says. This means it's more difficult to get approved for credit, and when you do get approved, your rates are on the high side.

Take comfort in knowing that when you make it into the mid-660s, you're very close to leaping into prime territory (around 670). You still won't get the deals that someone with excellent credit gets, but you'll be more likely to get approved for credit. And, of course, you'll get better rates than you'd get in the lower range of the fair category.

Fair Credit and VantageScore 3.0

VantageScore ranges from 300 to 850, just like the FICO score does. These are the VantageScore ranges:

-- Excellent: 750 to 850

-- Good: 700 to 749

-- Fair: 650 to 699

-- Poor: 550 to 649

-- Very Poor: 300 to 549

Note that with this score version, fair credit ranges from 650 to 699. With FICO Score 8, fair credit is from 580 to 669. There's a little overlap, but with VantageScore 3.0, you need a score of 700 to cross over into the good credit range.

[Read: Best Cash Back Credit Cards.]

How to Go From Fair Credit to Good Credit

Although the score ranges for fair credit vary a little, there are some basic habits to develop that will move you up the ladder with either FICO Score or VantageScore versions.

Create a budget that works for you. You might be wondering what this has to do with your score. Think of your credit score as a house. Your foundation for this house? A budget that shows where your money is going.

So, it's essential that you're brutally honest while setting up your budget. If you already have a budget, go through it again to make sure the numbers still apply.

If you slash expenses without being committed to the cuts, your budget will be meaningless. When your budget is meaningless, you overspend with credit cards and get into debt.

When you're in debt, your score usually drops, so that's how all this connects. A shaky foundation equals a shaky score.

Track every dollar you spend. If you think tracking your spending is too hard to do, then you're going to be pleasantly surprised. You don't have to use pencil and paper or create a complex spreadsheet in Excel unless that really makes your heart sing.

You can track your spending using free online money management programs, such as Mint.com, which also has an app version. Or you might prefer a tool like YNAB (youneedabudget.com), which isn't free, but does a great job of keeping you involved with your finances.

[Read: Best Secured Credit Cards.]

Use credit-building tools. No, you do not have permission to go buy a sports car in the name of credit-building. But if your credit resume is pretty bare, consider adding a credit card or a credit-builder loan.

There are some good credit cards that target those with fair credit. If you're at the low end of the fair credit range, you might have trouble getting approved for credit cards.

Take a look at secured credit cards if that happens. These cards are listed on your credit report as a revolving credit account, not as a secured credit card account.

Another option is getting a credit-builder loan from a credit union or from a local bank. This type of loan is identified as an installment loan by the FICO score, so that also gives you a small boost in the "mix of credit" category.