What Credit Score Do You Need for a Medical Loan

What Credit Score do You Need for a Medical Loan – Overview

Health is wealth, and we can all agree on this. However, you may also be aware that to maintain your health, you need sufficient finances, thanks to the growing cost of medical treatments.

The cost of healthcare in the US is significant. Even if you have a health insurance policy intended to make treatments cheaper, you could still have to make a partial payment, which can run anywhere between a couple of hundred dollars to thousands of dollars.

This is a dire situation for those without health insurance.

To remedy this, you can now apply for medical loans.

What is a Medical Loan

A medical loan falls under the personal loan category intended to cover the cost of medical treatments only. Conventional banks and finance companies generally offer medical loans as unsecured loans.

Medical loans do not require collateral, which means there is no risk of losing property or vehicles in case of default, though this can lead to higher interest rates and fees.

In contrast, this also means you should have a sufficiently satisfying credit score to avail of medical loans.

Even with a good credit score, unsecured loans are more expensive than secured ones. If your credit score is low, you may pay a higher interest rate and possibly higher origination fees.

What is the ideal score for a Medical Loan?

On a credit scale of 300 to 850, the ideal score is around 700 and above. A credit score of 800 and over is considered excellent.

The credit score for the majority of consumers falls between 600 and 750. Higher credit scores give lenders confidence that their loan will be repaid on time, as the loan agreement instructs. However, many lenders tend to set standards that reconsider a credit score that is good enough.

On one hand, lenders may consider the type of borrowers they want to engage. Lenders may also consider the impact of current events on the applicant’s credit score and adjust their credit score standards accordingly.

Additionally, some lenders have credit rating programs; however, the most common type of credit score considered by most lenders is the scoring system developed by VantageScore and FICO.

What is a good credit score under FICO?

FICO, short for Fair Isaac Corporation, offers a “base” score that companies consider before approving consumer loan applications. This is the most commonly used scoring system in the credit card and auto loan industries.

The base FICO score is between 300 and 850, with a score between 670 and 739 considered a good credit score.

What is a good credit score under VantageScore?

VantageScore revised its credit scoring scale recently. Under the newly introduced VantageScore credit score rating system (VantageScore 3.0 and VantageScore 4.0), the scale ranges between 300 to 850 (similar to the FICO score) and between 661 and 780, respectively.

How do you maintain a good credit score for a Medical Loan?

If your credit score has slumped and you want to improve it to avail of medical loans, then you can follow the below-given tips to get a better credit score:

1 – On-time payments

Making loan EMI payments on time helps maintain a good credit score. However, if you miss payments and the lender sends debt collectors, or if you file for bankruptcy, this affects your credit score adversely.

2 – Credit use

The lenders also consider the number of accounts with balances, the amount the borrower currently owes, and the part of the credit limit the borrower ends up using on revolving accounts are also considered.

3 – Credit history’s length

The lender of a medical loan also considers the average duration of all your credit accounts, including information on the oldest and latest accounts.

4 – Types of accounts

This is also called a “credit mix.” Under this, the lender checks whether you have been satisfactorily managing both installment and revolving accounts. The ability to manage the two accounts satisfactorily also helps to improve your credit score.

5 – Activity history

The lender also considers whether you’ve recently applied for or opened new accounts.


A credit score over 600 may qualify you for a medical loan, but scores around 700 and above are typically considered ideal to obtain better loan terms. If your credit score has suffered recently, you can try the above-given tips to improve it and easily avail of medical loans.

See Also

Loans for Plastic Surgery with Bad Credit

Medical Loans for Bad Credit UK

Loans for Dental Work with Bad Credit

Medical Loans for Bad Credit

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