Since 2013, there has been a consistent increase in America’s average FICO credit score. 2019 data showed that the average score was 703, regarded as good credit. What about how to get 850 credit score with perfect credit? A perfect score is achievable. However, it is uncommon, and it can be challenging to sustain.
The good news is that having excellent credit might help you even if your credit score isn’t perfect. Let’s examine what a perfect credit score looks like, why experts consider having great credit sufficient, and what you can do to raise your credit score and perhaps even reach a perfect 850.
- 1 How To Get 850 Credit Score and Why Its A Good Thing
- 2 Does getting an 850 credit score provide any additional benefits?
- 3 Tips On How To Get 850 Credit Score and Improve It
- 3.1 Pay close attention to credit usage.
- 3.2 Be persistent
- 3.3 Apply for credit only as necessary.
- 3.4 Think about a debt consolidation program
- 3.5 Check Your Eligibility for a Card with 0% Interest.
- 3.6 Utilize programs that will increase your scores
- 3.7 Pay your bills on time.
- 3.8 Take a look at your credit report.
- 3.9 How To Get And protect Your 850 Credit Score
How To Get 850 Credit Score and Why Its A Good Thing
Your FICO® score of 850 is almost flawless and will be seen as evidence of virtually immaculate credit management. Since you have a very minimal chance of missing a payment, you can count on lenders to give you their finest offers, including the lowest interest rates on the market.
You may also be able to take advantage of the most abundant loyalty and rewards programs that credit card issuers have to offer. An exceptional credit score can increase your chances of refinancing existing debt at more enticing rates and getting approved for premium credit cards, auto loans, and mortgages.
Does getting an 850 credit score provide any additional benefits?
Although a score of 850 is ideal, experts advise that good to exceptional credit is usually sufficient to increase your chances of being accepted for credit cards, loans, and mortgages with more favorable interest rates and loan terms.
And achieving it is much simpler. In actuality, 58 percent of Americans already have a FICO score of 703 or above, which falls squarely in the “excellent” area.
However, there is a catch: the higher your credit score, the greater your chances of locking in reduced interest rates. In general, lenders do not differentiate between scores of 800 and 850.
Some experts even go so far as to say that FICO scores higher than 760 might not offer any further advantages, meaning a score in the upper 700s might, in many circumstances, be equal to flawless.
For instance, according to FICO’s Loan Savings Calculator, a score of 760 might get you the same low-interest rate on loan as an 850.
Tips On How To Get 850 Credit Score and Improve It
Pay close attention to credit usage.
Your credit usage rate is calculated by dividing the amount of available credit by the amount of credit you currently use. It accounts for 30% of your credit score and is frequently the most neglected way to raise it. Revolving credit typically refers to credit card, personal, and home equity lines of credit. A healthy credit utilization rate never goes over 30%. Thus, you should never utilize more than $1,500 of your $5,000 credit limit.
Your credit score won’t change significantly overnight. Establishing sound long-term credit practices is the most excellent strategy to get a high score.
Before reaching the maximum limit in those categories, you’ll need to have had credit for a few decades. You can improve a bad score over a very long period but destroy a high score in a concise period.
Form excellent habits, such as paying your obligations in full when due, maintaining a low credit utilization rate, and only applying for credit when necessary. You should gradually see improvements in your credit score.
Apply for credit only as necessary.
A hard query is made on your credit record each time you apply for a new credit line. This kind of query briefly lowers your score. It’s not a good idea to apply only to check whether you’re accepted or because you got a pre-qualified offer of credit.
A single hard credit pull will result in a minimal drop. On the other hand, hard inquiries can indicate to lenders that you are taking on too much debt. According to a TransUnion representative, the consequences of a hard credit pull on your score might endure up to 12 months.
If you need to apply for new credit, make sure you’re a strong candidate by researching your acceptance chances. Get pre-approval or pre-qualification if possible because they frequently lead to soft rather than hard credit pulls.
Soft checks do not affect your credit. Additionally, it would help if you waited before asking for a sizable loan like a mortgage or applying for multiple credit cards in a short period.
Making rate comparisons will help you limit your hard inquiries when looking for a mortgage, auto loan, or personal loan. Within a specific time frame, only one hard inquiry will be made for applications for the same loan. According to FICO, this time frame might range between 14 to 45 days.
Think about a debt consolidation program
Enrolling in a debt consolidation program may result in a temporary reduction in your credit score. Still, as long as you make your payments on time, your score quickly rises, and you are eradicating the debt that caused you trouble in the first place.
Check Your Eligibility for a Card with 0% Interest.
There are restrictions attached to the cards that many businesses offer, which charge no interest on balances. The 0% deal is only valid for a limited time during the promotional term, which is usually 12 to 18 months, and there may be a cost for transferring the balance.
To be eligible for one of these, you typically need an extremely high credit score.
Utilize programs that will increase your scores
A person with little credit history may be at a disadvantage because the number of accounts you have and the average age of those accounts play significant roles in determining your credit score.
Programs like Experian Boost and UltraFICO enable customers to strengthen a weak credit profile with additional financial data.
Once you’ve chosen to use Experian Boost, you can link your online banking information and authorize the credit agency to include payment records for your phone and utility bills in your report. You can approve UltraFICO to use your banking information, such as checking and savings accounts, and your report to determine your score.
Pay your bills on time.
Payment history is the most crucial component for both your FICO and VantageScore, according to Experian. A track record of on-time payments is a positive sign to a lender that you’ll manage your debt responsibly moving forward.
According to credit expert John Ulzheimer, formerly of FICO and Equifax, “you want to prevent things like late payments, defaults, repossessions, foreclosures, and third party collections.”
Furthermore, declaring bankruptcy is the wrong choice. Your credit score will suffer if there is any indication of non-performance of a liability.
Take a look at your credit report.
Each of the three credit reporting agencies must provide you with a free credit report once each year, and requesting one does not affect your credit score. Analyze each report in detail. It would be best if you dispute any mistakes you find. This is the closest thing to a quick credit fix you can find.
According to government research, 26% of customers have made at least one potentially major blunder. Some are straightforward errors, such as misspelled names, addresses, or accounts held by others with the same name as you.
More expensive errors include:
- Having an incorrect amount or credit limit.
- Listing bills twice.
- Reporting closed accounts as still active.
- Mistakenly representing accounts as being past due or delinquent.
Your score will rise as soon as you remove inaccurate information by informing the credit reporting bureau of it. About 20% of customers who found errors experienced an improvement in their credit scores.
How To Get And protect Your 850 Credit Score
Identity theft, one of the illegal activities that are expanding the fastest, can be a significant target for people with exceptional credit ratings.
You can deter cyber criminals by using services that monitor your credit report and protect you from identity theft. These services can assist you in maintaining outstanding credit and an exceptional FICO® Score by warning you when your credit score changes and when there is questionable activity on your credit report.
When you use credit monitoring to watch your credit score, you’ll also be able to detect any drops below the Exceptional range of 800-850 and take immediate action to try to help the score rise again.