Around 630 is the magic number. Below that, loans get expensive fast. I mean really expensive.
Let me show you the math on a $20,000 personal loan for three years, based on average rates from mid-2026:
- Credit score 760+: around 7.5% APR → total interest around $2,400
- Credit score 700-759: around 9.5% APR → total interest around $3,100
- Credit score 650-699: around 14% APR → total interest around $4,700
- Credit score 600-649: around 21% APR → total interest around $7,200
- Credit score below 600: around 28% APR → total interest around $9,800
That's a difference of around $7,400 between the highest and lowest credit tiers. On a $20,000 loan. Over three years.
I had a client named Victor. His credit score was 612. He needed a $15,000 loan to consolidate his credit cards. The best offer he could find was 24% APR. That's around $5,200 in interest over four years.
I told him to wait three months. In those three months, he paid down two small collections accounts, disputed an error on his credit report, and kept all his other payments current. His score climbed to 662. He reapplied. New offer: 17% APR. Total interest dropped to around $3,500. He saved around $1,700 by waiting 90 days.
Victor thought I was crazy. He wanted to consolidate now. But he listened. And he's glad he did.
Here's the point: your credit score isn't just a number. It's a dollar amount. Every time you apply for a loan, you're paying either the "good credit" price or the "bad credit" price. The difference can be thousands of dollars.
If your score is under 680, consider waiting a few months to improve it before taking a new loan. Pay down credit card balances. Dispute errors. Don't apply for new credit unnecessarily. It's boring advice. But it works.
I will keep posting updates on this. Check back soon.
P.S. Victor called me when he got the approval letter. He said, "I literally can't believe it." I could. That's literally my job.
— J.W.