Everyone wants a perfect credit score. However, the truth is that only 1.2 percent of consumers actually score the ideal 850. Getting an excellent credit score might not be as easy as it seems.
Fortunately, you don’t need the perfect credit score. With a FICO credit of 800 and above, you can enjoy the benefits of near-perfect credit. Keep reading to learn more if you wish to be among the 1.2 percent with excellent credit.
What Does It Mean to Have a Perfect Credit Score?
With an 850 credit score, your credit is at its highest. This is the highest score in both the VantageScore and FICO scoring systems. With FICO, however, any credit over 800 is considered exceptional. You can enjoy all the benefits that come with a perfect credit score. However, trying to achieve perfection can be a fun and rewarding game.
With a credit score of over 800, there isn’t much else to do. It is all about keeping your utilization low and waiting it out.
The Benefits of Credit Score 850
When you have excellent credit, you are eligible for almost all of the leading credit cards. This includes premium options like The Platinum Card ® from American Express, Chase Sapphire Reserve®, and the Citi Prestige® Card.
Even though your application for certain credit cards may still be rejected, it won’t be because of your credit. In fact, lenders will be happy to work with you.
Your excellent credit score could help you score ideal interest rates. This comes in handy when taking out a car loan or mortgage. If you got your mortgage before earning the perfect credit score, you could save money when you refinance your mortgage. Your interest rates may drop significantly.
With a credit score of 850, you’ll have an easier time renting an apartment. Most landlords perform credit checks when you turn your application in. Your excellent credit score could also help during your job search. Some employers check your credit history during the interview stage.
Why You Shouldn’t Settle for Good Credit
The gap between good and excellent credit is wide. Good credit falls in the range of 700-759. It will put you in a good position where most approvals are concerned. However, it doesn’t get you the best interest rates. Monthly interest rates for good credit are higher than excellent credit.
How to Improve Your Credit Score
Do you want to get an ideal credit score? The first step is to build good credit. First, you’ll need to pay off your credit card debt on time. Keep your credit utilization ratio under 30 percent. When you have good credit, you can start trying to perfect it with the following tips:
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Get Credit Repair Services
Consider working with a credit repair company to get an 850 credit score. The best credit repair companies act on your behalf. They remove negative items that may harm your score. This may include late payments, bankruptcies, and charge-offs.
If you need a reliable credit fix, find a reputable company. Top-rated credit repair companies know how to use federal consumer protection laws to protect your rights. They know what to do if creditors prove what they report about you to credit bureaus.
Unlike individuals, they have the time and skills to handle all your credit needs. With credit repair DIY, you would have to learn consumer law and all about credit scores and credit reporting. Unless you have a lot of free time, this isn’t practical.
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Review Your Credit Reports
Keep track of your credit report and dispute all errors. Do not assume that the information on your credit report is always correct. There may be inaccurate information that could affect your credit score. The credit account on your report might belong to someone else. This is a common mistake for people with similar names.
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Take Charge of Your Bill Payments
Over 90 percent of reliable lenders use FICO credit scores. Your eligibility for a loan may depend on your credit usage, payment history, credit mix, new credit inquiries, and the age of your credit accounts. Your payment history is the biggest determinant of whether you may be eligible for a loan.
Pay off old student loans and other loans responsibly. They stay on your record for a long time and may work in your favor or against you. Here are a few tips to help you stay on top of your bill payments.
- Automate bill payments from your bank account
- Create a digital or paper filing system to help track your monthly bills
- Set due-date alerts to ensure that you are never late on upcoming bills
- Charge all your monthly bills to your credit card. This tip work under the assumption that you will fully pay the balance in a month to limit interest charges.
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Aim for a Maximum of 30 Percent Credit Utilization
Credit utilization is the part of your credit limit that you are utilizing at any point. It is one of the top contributors in the calculation of FICO credit scores. The most realistic way to control your credit utilization is to pay your credit card balance in full every month.
Ensure that your total outstanding balance is always less than 30 percent of your credit limit. You can then work on reducing it to ten percent or less.
The high balance alert feature on your credit card should help you avoid new charges. Asking to raise your credit limit can also help your credit utilization ratio. The secret is to ensure that your balance doesn’t increase with it.
Conclusion
Working towards an excellent credit score may not be easy, but it is worth the effort. It is essential when you plan to apply for a loan or make a significant purchase.
There is plenty to do on your own. However, working with an affordable credit repair company is your best option. They will help you get rid of negative marks and give you helpful tips to implement. The sooner you start trying to improve your credit, the better.