What Does a 625 Credit Score Mean?

Credit Score
Get your AECB Credit
Score

The cost of the AECB Credit Score will be borne by Policybazaar.ae. T&C apply *

  • Easy loan approvals
  • Credit limit Increased
  • Reduced Insurance Premiums

Check your Credit Score for Free in 2 Minutes

next-icon

Check your Credit Score for Free in 2 Minutes

Enter the Mobile Number Registered with your Credit Card/Loan account. You will get the OTP on this number
By Clicking on "Check Credit Score", I declare that I am a resident of UAE and holding a valid Visa and agree to the website Privacy Policy and Terms of Use.

Credit scores are calculated by the Al Etihad Credit Bureau (AECB), the authorised body for credit score calculations. AECB ranks the scores in five different categories and allows them a star-based rating. Your credit score determines your credibility and likelihood of defaulting payment.

Financial institutions check your credit score when you submit an application to avail of a credit facility. Hence, checking your credit score is important to get your desired credit facility with ease and to take the necessary steps to further improve your credibility. We will use this piece to understand what the 625 credit score means, how you can improve it and which credit facilities you can get with it.  

Credit Score - Policybazaar uae

What Does a 625 Credit Score Mean?

According to the AECB, a 625 credit score is a ‘low’ category credit score and has a two-star rating. It represents low creditworthiness and high chances of payment defaults in the next 12 months. The 625 credit score is, thus, viewed with caution, and lenders try and abstain from offering loans to borrowers with such low scores. Banks and finance houses that approve borrowers with a low credit score tend to offer high interest rates to cover the risk these borrowers bring to the table. 

What Can a 625 Credit Score Get You?

As established in the earlier section, getting credit facilities might prove to be a challenge with a credit score of 625. However, many lenders sanction a loan or issue credit cards even at a 625 credit score.

Let’s take a look at the credit facility options that the 625 credit score can get you:

Credit Cards for 625 Credit Score

Obtaining a credit card is possible with a 625 credit score depending on the type of card you choose.

Following are the types of credit cards that you can get with a 625 credit score:

Secured Credit Cards:

Secured credit cards are sanctioned against collateral. The issuer can liquidate the collateral if you fail to pay the bills. Secured credit cards can easily be availed by borrowers with a 625 credit score. 

Unsecured Credit Cards:

Unsecured cards do not need any collateral and are issued simply based on your income and some other eligibility requirements. You can get unsecured credit cards from banks and credit card issuers with a 625 credit score. However, banks may charge a higher rate of interest

Special Benefit Credit Cards:

Special benefit credit cards come with one or multiple value-added benefits like cashback, rewards, loyalty points etc. These cards can be obtained with a credit score of 625 however the borrower will be required to clear the individual eligibility criteria of each individual card. 

Personal Loans for 625 Credit Score

Many banks offer secured and unsecured personal loans with a 625 credit score. Secured personal loans can be taken at a lower interest rate. Unsecured personal loans for a 625 credit score might be obtained at a comparatively higher interest rate. Since a 625 credit score is a low category score, you may not be able to negotiate the terms of your personal loan either. 

Credit Score - Policybazaar uae

Home Loans for 625 Credit Score

Getting a home loan with a 625 credit score might prove challenging because home loans are high-value loans that come with long-term repayment tenures. If a lender agrees to give you a home loan with a 625 credit score, the loan amount for it will be restricted. You might also be charged a higher interest rate on the loan, and your repayments would be closely monitored by the lender. In some cases, you might need to arrange for a co-borrower to be able to qualify for the loan with a low credit score. 

Auto Loans for 625 Credit Score

Lenders are more lenient when offering auto loans. This means you can get a 625 credit score car loan as well. However, the loan might require you to make a higher down payment to cover your higher risk level. In addition to that, the interest rates might be high given the high default risk that the lender is taking in disbursing a 625 credit score car loan. 

Insurance Plans with a 625 Credit Score

Your credit score does not determine whether you will get insurance coverage or not. However, it does have a bearing on your insurance premium. So, with a 625 credit score, you will be able to buy insurance plans easily. However, the premiums might be a tad bit higher. 

Tips to Improve Your 625 Credit Score

If you have a low credit score you can improve it using a few simple tricks. A positive change in your credit behaviour and financial management style can increase your credit score. So, if you want to build up your credit score, here are some tips on how you can improve it:

  • Do not default your loan instalments credit card bills or monthly utility bill payments. Always pay your dues on time. If you have multiple bills to track, you can set reminders or set up an auto-pay system for all your payments. 
  • Avoid making multiple loan or credit card applications within a short duration. Carefully research your options and choose the variant that suits your requirements the best. If it is a credit card, stick with it for as long as you can. 
  • Keep your credit portfolio diverse with a mix of both revolving and instalment credit. Credit card is an example of revolving credit tool while loans are an example of instalment credit. 
  • Keep credit utilisation ratio on point by utilising only 10% to 30% of your credit limit. 
  • Keep a track of your credit score. Check it quarterly or half-yearly to take corrective measures in time, if required.

How to Check Your Credit Score for Free?

You can check your credit score from the official platform of AECB for a fee. However, you can check your credit score free of cost on our official website, Policybazaar.ae when you are applying for a credit card or a personal loan. Simply enter your details and find out your score. Your scores are obtained directly from AECB to ensure accuracy. 

Conclusion

A 625 credit score is a low category credit score and hence proves to be a hindrance in your way of obtaining a credit facility in the UAE. However, a 625 credit score can be increased if you take the necessary steps to improve it. You can visit Policybazaar.ae, check your score and take necessary steps to improve it if it is low. Knowing your credit score can help in choosing the ideal credit services that you can easily get. Try to build up a good credit score so that when you seek loans, you have an abundance of options to explore.

More From Credit Score