How to get there – Forbes Advisor

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If you want a well above average credit score, aim for a credit score of 800. While this score is not the highest possible credit score, it puts you in the highest credit score range. highest available for the FICO credit score model. Borrowers in this range of credit scores generally present the least risk to lenders.

For this reason, if a lender approves you, you are likely to have a better chance of getting the most favorable terms, such as the lowest interest rate available. Forbes Advisor will teach you what it means to have an 800 credit score, how to achieve it, and the benefits that come with it.

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What does it mean to have a credit score of 800?

When you have a credit score of 800, your score is better than a good credit score. According to the most popular VantageScore and FICO credit scoring models, this is an excellent or exceptional credit score. In April 2018, only 21.8% of Americans had a score of at least 800, according to a FICO report.

To achieve such a score, you have to do an outstanding job of managing your credit. This means that you probably have a long credit history, a perfect payment history, a good credit mix, and you are only using a small percentage of your total credit limit. Based on your excellent credit history and good credit habits, a lender will consider you less likely to default on a loan than applicants with lower credit scores.

How to get a credit score of 800

While there is no guarantee that your score will reach 800, applying these tips could help you improve your score.

1. Build or rebuild your credit history

Since the length of your credit history is 15% of your credit score, negative, minimal, or no credit history can prevent you from reaching a credit score of 800. To resolve this issue, focus on building up your credit. You can do this by taking out a builder loan or by applying for your first credit card.

A credit loan is a personal loan designed to help you add a positive payment history to your credit report. Unlike a traditional personal loan, a lender does not directly deposit a lump sum amount of money into your account. Instead, it puts money aside in a savings account or certificate of deposit account (CD), and you access the funds after you repay the loan.

Another way to build your credit history is to use a credit card responsibly. If you aren’t eligible or don’t want to use a traditional credit card, you can apply for a secured credit card instead. When you purchase a secured card, you will need to make a cash deposit held in a security account equal to your credit limit.

2. Pay your bills on time

Your payment history is the most important credit score factor – it accounts for 35% of your FICO score. For this reason, you should aim to never miss a payment. If your bills are 30 days past due, your creditors can report it to the credit bureaus. Once your credit report shows late payment, it can cause serious damage to your credit score. To avoid paying your bills late, use a spreadsheet to track your due dates or sign up for automatic payment.

According to FICO, most people who have credit scores of 800 or higher pay off their balance in full each month.

3. Keep your credit utilization rate low

The second most important credit score factor behind payment history is your credit utilization rate – it makes up 30% of your credit score. Your credit utilization rate measures the amount of credit you use against your total credit limit. If your total credit limit is $ 10,000, try not to use more than 30%, or $ 3,000. To increase your credit score, keep your ratio closer to 0% if possible.

4. Examine your credit score and credit reports

To track your progress, monitor your credit score and credit reports. You can check your credit score for free using a free credit rating website. Some of these websites will even offer you recommendations on how to improve your credit score.

Since your credit score is based on the information listed in your credit reports, review them to make sure that each one doesn’t contain inaccurate negative information, such as late payments or collection accounts. Even if you pay your bills on time, a credit report error can happen. You can view your three reports for free each week until April 20, 2022 by visiting AnnualCreditReport.com.

If you find an error listed on any of your reports, file a case with each credit bureau that listed it to remove it.

Benefits of an 800 credit score

A credit score of at least 800 has several advantages, including easier loan approvals, lower rates, better credit card deals, and lower insurance premiums.

Better chances of loan approval

When you apply for a mortgage, personal loan, or private student loan, you won’t have to worry about meeting a lender’s minimum credit score requirements with a score of 800. As long as you meet other loan requirements, such as income and debt, the lender will likely approve your application.

Lower interest rates

A credit score of 800 will usually get you the best interest rate available if you are approved for a loan. For example, you might qualify for 0% financing on a new car or a lower mortgage or personal loan rate. It can save you thousands of dollars in interest over the course of your life.

Best Credit Card Deals

Highly qualified borrowers with credit scores of at least 800 can qualify for the best 0% APR credit cards. These cards come with interest-free periods of up to 21 months on balance transfers and purchases. As long as you pay off the balance in full before the promotional period expires, you can avoid interest payments.

Plus, you’ll likely qualify for some of the best travel credit cards out there. Some of these cards come with generous travel bonuses once you meet their minimum spending requirements.

Lower insurance premiums

When you apply for insurance, some insurers take your credit score into account when calculating your insurance premium. If you live in a state that allows credit insurance, a credit score of 800 could qualify you for a reduction on your home or auto insurance premiums.

For example, you can save over $ 1,500 in auto insurance premiums if you have a great credit score versus a bad credit score (below 580), according to a study on auto insurance from The Zebra. .

How to maintain a credit score of 800

Once you hit a credit score of 800, your job is far from over. Your credit score is not set in stone, it fluctuates based on the factors we discussed above. If you want to keep your score in the highest possible credit score range, you will need to continue to practice good credit habits. This means often monitoring your credit score and reports, keeping your credit usage low, and paying your bills on time.

Increase your FICO® score instantly with Experian Boost ™

Experian can help you increase your FICO® score based on paying bills like your phone, utilities, and popular streaming services. Results may vary. See the site for more details.


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