You already know a perfect credit score is hard to come by. But what about the worst credit score? With credit card debt reaching nearly $1 trillion dollars last spring, it doesn’t sound like much of a challenge. Yet you’d be surprised by what it takes to earn a truly terrible score.
The Worst Credit Score Ever
According to Barry Paperno, a credit scoring expert with years of experience at FICO, there is no such thing as a zero credit score. That’s because most major credit score models, like FICO and VantageScores, use models with a 300 to 850 range. Theoretically, 300 would be the lowest score you could get, although that would be as “unusual” as receiving an 850, Paperno says.
Rod Griffin, a credit expert with Experian, said the worst score a person could possibly have would depend on the system being used. “The original VantageScore used a scale of 501 to 990,” he wrote in an email, “but its latest version has a 350 to 850 scale.”
As Griffin advises, it’s important to “ask your lender what score they use and what the scale is. That’s the only way to know what the worst possible score would be for a particular lending situation.”
Race to the Bottom
So what does it take to earn the worst credit score ever? For that, Paperno offered some guidelines: Do exactly the opposite of what it takes to get a good credit score, and you’ll get that 250 or 300.
Credit agencies use five factors to crunch your credit scores: payment history, or your track record of making payments on time; mix of accounts, or how many different accounts you have open; your debt, especially in relation to your credit card(s)’ available limits, known as your credit utilization ratio; how long your accounts have been open; and new credit, i.e., how often you shop for credit. Here’s how to fail in each category.
Payment History: Make all your payments late, or better yet, don’t make them at all. Let an account go to collections, and forget about it entirely. Ignore the collectors’ attempts to get in touch with you by mail or telephone.
Mix of Accounts: Leave the mortgages and automobile loans to your friends who want a good mix of credit accounts. Right now, your focus is only on one thing: credit cards, and plenty of them.
Debt: Go shopping until you max out every single credit card. Buy everything. Who cares about the available credit limit?
Account History: Make sure every credit card has been opened recently, ideally in the past 6 months. Close anything older. Using any account you’ve managed responsibly is out of the question.
New Credit: With all your cards maxed out, the only thing left to do is apply for another. And another after that. Keep racking up those hard inquiries.
Sound like a bad idea? It is. Tanking your credit can have serious implications for your finances and your future, making it tough to secure a mortgage, a new apartment, a car loan and so much more. You can see how your behaviors are affecting your credit by viewing your free credit summary, updated each month, on Credit.com.