Dave Ramsey is famous for claiming that he has a credit score of zero, by which he means he avoids credit all together. But is it actually possible to have a credit score of zero?
According to FICO spokesman Barry Paperno, the answer is “no.” FICO credit scores range from 300-850, so the lowest possible score is actually 300. What’s my credit score?
To get that low, however, you’d have to do virtually everything wrong, and have no positive credit history whatsoever. As a quick example, Main Street highlighted a guy who had accumulated nearly $300k in debt due to a string of bad investments, experienced a foreclosure, gone on a debt management plan, and ultimately filed bankruptcy.
Guess what? His credit score never even got into the 300s. Rather, it bottomed out at 471. Of course, once you get down near 600 you’re pretty much screwed when it comes to securing credit, but still… It’s actually pretty hard to completely destroy your credit score.
As I’ve mentioned before, your credit score is based on five main factors, including your payment history, amounts owed relative to your available credit, length of your credit history, number of accounts, and types of credit used. In order to achieve a lowly 300, you’d have to bottom out in all five categories at once.
Thus, according Paperno, you’d have to be a new customer (so no history) and then do something like open a ton of new accounts (just one type), max them out in rapid succession, file bankruptcy, and then immediately apply for more accounts (of the same type). But you had better act fast, because having a credit history (even a negative one) is viewed as being at least slightly positive.
Interestingly, while you can’t actually reach zero (or even 300, for all practical purposes), you can fail to qualify for a credit score. More specifically, FICO requires that you’ve had (and used) an account within the past six months in order to assign a score. Check your credit score.