No Credit vs. Bad Credit: Which is Worse?

Most St. Louis customers know the differences between good vs. bad credit, but that’s only part of the story. Between no credit vs. bad credit, which is worse and why? While neither are ideal, there are plenty of ways to better your financial situation regardless of your current score. Read on to learn more about the key differences between credit histories:


What Does it Mean to Have Bad Credit?

A bad credit score is generally a score below 630 on a scale of 300 to 850. Between no credit history vs. bad credit, bad credit means that you have secured financing in the past, but you’ve faced a few stumbles along the way. Some behaviors that may tank your credit score include:

  • A history of late payments
  • Spending over 30 percent of your credit limit
  • Letting accounts go to collections
  • Bankruptcy

What Does it Mean to Have No Credit?

While those with bad credit have secured and lost financing in the past, those with no credit have zero credit history to assess. This is also seen as a potential risk to lenders, because they have no track record at all. You might be a responsible person or a complete liability. Because of this uncertainty, those with no credit often have higher interest rates and fewer options when it comes to securing proper financing.

Customer standing next to her new car

How Can I Improve My Standing?

Whether you have bad credit or no credit, you still have options to improve your financial standing for good. Follow these tips to establish your credit, and give yourself a better chance of getting approved for an auto loan or other types of credit in the future: 

  • Start keeping track of your credit score by accessing your free report every yearly  from each of the three major agencies. Look for errors and dispute errors online.
  • Build credit with options like secured credit cards and credit-builder loans, and be sure to make your payments on time!
  • Consider enlisting help by getting a trusted person to act as a co-signer on loans.

Learn More About No Credit History vs. Bad Credit History! 

If you’re hoping for a brighter financial future in St. Charles or Florissant, contact us at Green Light Auto Credit for personalized advice from seasoned experts. Our finance center can help you secure the funding you need, and you can even get pre-approved online!