Shall I work on my 645 credit score? Absolutely. While a 645 score is considered fair, improving it can help you qualify for better loan terms, lower interest rates, and more financial opportunities. It also boosts your chances of getting approved for credit cards, rentals, and even some jobs.
One client once asked us the same question. At first, he ignored credit repair and didn’t think much of his 645 score—until he got denied for a car loan. A month later, he came back to us ready to take action.
In the next sections, we’ll talk more about why your credit score matters, how it affects everyday decisions, and simple steps you can take to improve it starting today.
What Does a 645 Credit Score Really Mean?
A credit score is like a report card for how you handle money. Just like school grades, credit scores range from very bad to excellent. A 645 credit score falls in the "fair" category. This means you're not failing, but you're not getting A's either.
Credit scores typically range from 300 to 850. Here's how they break down:
- 300-579: Very Poor
- 580-669: Fair (This is where 645 sits)
- 670-739: Good
- 740-799: Very Good
- 800-850: Excellent
So yes, you absolutely should work on improving your 645 credit score. Think of it like being in 6th grade - you're doing okay, but there's still a lot of room to grow and get better.
Why Your 645 Score Limits Your Options
Right now, your 645 credit score is holding you back from getting the best deals on money. Banks and lenders see your score and think you might be a bigger risk. This means they either say no to you completely, or they make you pay extra money in fees and higher interest rates.
Most lenders want to see credit scores of 700 or higher before they offer their best deals. It's like trying to get into an advanced class at school - you need good enough grades first. With a 645 score, you're still in the regular classes, missing out on the advanced opportunities.
When you apply for loans or credit cards with a 645 score, lenders might ask for more paperwork, require you to put down more money upfront, or make you wait longer for approval. Some might even say no completely.
The Big Benefits of Improving Your Credit Score
Save Thousands on Home Loans
The biggest benefit of improving your credit score is saving money on a house loan, called a mortgage. Let's say you want to buy a $250,000 house. With a 645 credit score, you might get an interest rate of 7.5%. But with a 720 credit score, you could get a rate of 6.5%.
That 1% difference might not sound like much, but over 30 years, it adds up to over $50,000 in extra money you'd have to pay. That's like buying a new car with the extra money you'd save just by having better credit.
Get Better Car Loan Deals
When you need to buy a car, having better credit can save you hundreds or thousands of dollars. Car dealers often mark up interest rates for people with fair credit. With a 645 score, you might pay 12% interest on a car loan. With a 720 score, you could pay 6% interest.
On a $20,000 car loan over 5 years, that difference means paying about $3,000 less in total. That's like getting a big discount just for having better credit.
Access to Better Credit Cards
Right now, with a 645 credit score, you probably can't get the best credit cards. The really good cards with cash back rewards, travel points, and low interest rates usually require scores of 700 or higher.
Better credit cards often come with:
- Cash back on purchases (like getting 2% back on everything you buy)
- No annual fees
- Lower interest rates if you carry a balance
- Higher credit limits
- Better customer service
- Protection when you travel
These benefits can save you hundreds of dollars per year and make your life easier.
Lower Insurance Costs
This might surprise you, but many insurance companies check your credit score when setting your rates. They believe people with better credit are more responsible and file fewer claims.
With better credit, you could save $200-500 per year on car insurance and home insurance combined. Over 10 years, that's $2,000-5,000 in savings just from having good credit.
Easier Time Renting Apartments
Most landlords check credit scores before renting to someone. With a 645 score, you might have to:
- Pay extra security deposits
- Get a co-signer
- Pay several months rent upfront
- Have fewer apartment options
With good credit (700+), landlords trust you more. You'll have more choices, might not need extra deposits, and the approval process goes much smoother.
Better Job Opportunities
Some employers check credit scores, especially for jobs that handle money or require security clearances. While they can't discriminate based on credit alone, having bad credit might hurt your chances for certain positions.
Jobs in banking, finance, government, and some retail positions often include credit checks. Better credit keeps all doors open for your career.
The Reality of Improving Credit on a Small Budget
Let's be honest about something important - improving credit when you're living paycheck to paycheck is really hard. If you're making $2,000 per month and your bills are $1,950, you only have $50 left over. That makes everything more challenging.
But here's the good news: you don't need a lot of money to improve your credit score. You mainly need time, patience, and the right strategy.
Start with Free Actions
The first step costs nothing. Get your free credit reports from annualcreditreport.com. Look for mistakes like:
- Accounts that aren't yours
- Wrong payment histories
- Old debts that should have been removed
- Incorrect personal information
Fixing these errors can boost your score quickly without spending any money.
Handle Collections Debt Smartly
If you have debt in collections (like from companies such as Resurgent, Qualia, or CCS), you have more power than you might think. Collections companies often bought your debt for much less than you originally owed. This means they'll often accept much less money to settle.
Here's a crucial point that many people don't understand: Collections accounts hurt your credit score just by existing on your report. Paying them in full doesn't automatically make your credit score jump up. The damage to your score is already done just by having the collection account there.
This gives you negotiating power. Instead of paying collections debt in full, try to negotiate "pay for delete" agreements. This means you pay them a smaller amount (maybe 30-50% of what they say you owe), and they completely remove the negative mark from your credit report entirely.
Don't pay collections accounts right away. Save your extra $50 per month for 3-4 months first. You need this money for two reasons: to have a small emergency buffer so you don't create new debt, and to have negotiating power when you contact collectors.
Once you have $150-200 saved, contact your oldest collection account and make an offer. Start with offering 30% of what they claim you owe. Many will accept this because they bought your debt for pennies on the dollar.
Always get any settlement agreement in writing before paying anything. Make sure it specifically says they will delete the account from your credit report, not just mark it as "paid" or "settled."
Prioritize medical collections first if you have any. Medical debt often settles for much less money and is sometimes easier to get removed from credit reports.
Use the Debt Snowball Method
When you have multiple debts and very little extra money, the debt snowball method works best for people in tight financial situations. Here's how it works:
List all your debts from smallest balance to largest balance. Don't worry about interest rates - focus on the total amount owed.
Pay the minimum required payment on everything. This keeps all accounts current and prevents new late payment marks on your credit.
Put any extra money toward the smallest debt first. Even if it's just $20-30 per month, attack that smallest balance until it's completely gone.
Once the smallest debt is paid off, roll that entire payment to the next smallest debt. Now you have more money to attack the second debt because you freed up the minimum payment from the first debt.
This method works because it frees up money faster than trying to tackle your biggest debt first. Each debt you eliminate gives you more monthly cash flow to attack the remaining debts.
If you have credit cards, how you use them matters a lot for your credit score. The most important rule is to keep your balances low compared to your credit limits. This is called your "utilization ratio."
Try to keep your credit card balances below 30% of your limit, but ideally below 10%. So if your credit limit is $1,000, try to keep your balance below $100.
Get a Secured Credit Card
If you don't have any open credit card accounts, or if your existing cards are maxed out, consider getting a secured credit card. This is a great tool for rebuilding credit.
A secured credit card works like a regular credit card, but you put down a security deposit first. If you put down $200, your credit limit is usually $200. The card company holds your deposit in case you don't pay your bill.
The key benefits of secured cards:
- They report to credit bureaus just like regular credit cards
- You can start with as little as $200 deposit
- They help build positive payment history
- Many companies will convert them to regular credit cards after 6-12 months of good payments
Use a secured card for small purchases like gas or groceries, then pay it off completely each month. This builds positive payment history without adding to your debt burden.
Ask for Credit Limit Increases
Call your credit card companies and ask for higher credit limits. Many will give you small increases automatically. This instantly improves your utilization ratio without changing how much you spend.
For example, if you have a $500 balance on a $1,000 limit card, you're using 50% of your credit. If they raise your limit to $2,000, now you're only using 25% of your credit, which looks much better to credit scoring systems.
How Long Does Credit Improvement Take?
Improving credit doesn't happen overnight, but you can see changes faster than you might think. Here's a realistic timeline:
1-2 months: Credit report errors get fixed, and any new good habits start showing up.
3-6 months: Your credit utilization improvements start boosting your score. If you successfully negotiate any "pay for delete" agreements, those positive changes appear.
6-12 months: Consistent on-time payments and lower debt balances create steady score improvements.
12+ months: Major improvements become visible as negative items age and positive payment history builds up.
The key is being patient and consistent. Small improvements each month add up to big changes over time.
Making It Work with Limited Money
When money is tight, every dollar counts. Here's how to improve credit without breaking your budget:
Focus on not making things worse first. Make sure you pay at least the minimum on all current accounts on time. Late payments hurt your score more than carrying balances.
Prioritize by impact. If you can only tackle one debt, choose the one that will help your credit score the most when resolved.
Look for free money and assistance programs. Check if you qualify for utility assistance programs, SNAP benefits, or local food banks. Many areas have programs to help with electricity, gas, water, and phone bills. Every dollar you save on necessities is a dollar you can put toward improving your credit.
Set up automatic minimum payments to avoid late fees and credit damage. Even if you can only pay the minimum, paying on time is crucial for your credit score. Late payments stay on your credit report for 7 years and can drop your score by 60-100 points.
Don't close old credit cards even if you pay them off. The length of your credit history makes up 15% of your credit score. Keep old accounts open to maintain a longer average account age.
Consider becoming an authorized user on a family member's credit card if they have good credit and low balances. Their good payment history can help boost your score without you having to qualify for new credit yourself.
The Bottom Line
Yes, you absolutely should work on improving your 645 credit score. The benefits - saving thousands on loans, getting better credit cards, paying less for insurance, and having more housing options - make the effort worthwhile.
Even with limited income, you can make progress. Focus on free strategies first, be patient with the process, and remember that small improvements add up over time. Your future self will thank you for every point you gain on your credit score.
The path from 645 to 700+ isn't easy when money is tight, but it's definitely possible. Take it one step at a time, celebrate small wins, and keep your eyes on the bigger financial opportunities that better credit will unlock for you.