Credit report means an individual's history of borrowing making payments. It also includes all your financial information, late payments that you may have made, and things related to bankruptcy in case you have applied for it. Whenever you apply for a credit card or loan, your personal information is forwarded to the credit bureaus, which in turn try and match your name and address, besides other information. Once they match your information, they send a report to the financial institutions, and this information is used by lenders to determine your creditworthiness. Timely payments indicate that you are willing to repay your debts on time, and the payments that you have made over time indicates that. What is Considered to be a Bad Credit Score? There are several people who don't know what it is and the steps to be taken to improve the ratings. Credit scoring systems vary, but the most common one is the FICO score. This is used by all the three bureaus and can be considered a standard system. The score ranges from 300 to 850 with 300 considered the worst and 850 considered the highest and the best. The criteria for determining this number depend on the type of loan you are applying. In case you are applying for a home loan, a score of less than 620 is considered bad. However, if it is just below 720 but more than 675, you are not considered to have a bad score, but still you may need to pay some percentage more in interest. If it is between 620 and 674, it's still not considered a bad one, but you need to pay considerably higher rate of interest. A score of less than 620 is, typically, considered bad. It's not that you won't get a credit card, but the rates of interest would be considerably higher. The best way to improve your ratings with this card is to make respective bill payments on time, so that your every transaction is reported, and you get a good score over time. Range Trouble starts if the score is in the range of 500 to 580, a range considered bad by financial institutions. Even the one below 620 is not considered to be good and in such cases, you will be charged higher rates of interest. Of course, you won't like the terms and conditions of the loan, but you don't have any option. The best way is to take it positively and start paying off your bills on time, so that you can improve your score over time and be eligible for a loan with better terms and conditions. There are several things that you can do for credit repair. The most important thing is to avoid late payments or default on student loans; it's always there on your payment history. Moreover, tax liens and foreclosures should be avoided, and collection calls should not be ignored. In case the creditor files a lawsuit, your credit will be seriously damaged, and it will take longer to file for a comeback into the bad bracket. So, try to avoid this bad range, and make all possible efforts to come out of this bracket.