If you're looking to join the exclusive 800 club, you'll need to focus on building your credit. To do this, you can apply for a credit-building loan or your first credit card. Your payment history is the most important factor in your FICO credit score, so it's crucial that you always pay your bills on time. If your bills are 30 days late, your creditors can report it to the credit bureaus and cause serious damage to your credit rating.
To avoid paying your bills late, use a spreadsheet to keep track of your due dates or sign up for automatic payment. Depending on where you start, it can take several years or longer to get a credit score of 800. You should have a few years of only positive payment history and a good combination of credit accounts that show that you have experience managing different types of credit cards and loans. Your credit rating is one of the most important indicators of your financial health and plays an important role when lenders determine your eligibility for loans, interest rates, and more. The FICO score, which is the most commonly used credit score, ranges from 300 to 850, and many people consider a credit score of more than 800 to be ideal. The average FICO score in the U.
S. is 716, according to Fair Isaac Corporation, the company that created the scoring model. As such, the 800 club is relatively exclusive. Fortunately, if you make a mistake, you can quickly correct it and avoid any negative consequences on your credit rating. Lenders generally don't report late payments until they're due after 30 days.
According to Experian, people in Club 800 have an average utilization rate of 11.5%. However, keep in mind that this doesn't apply to lower-priced mortgage, car, and student loans. You can apply for several of these types of loans to compare rates, and as long as it's done in a short period of 14 to 45 days, depending on the scoring model, all the difficult queries will be combined into one for credit scoring purposes. The amount of time it takes to go from a 700 to 800 credit score can take anywhere from a few months to several years. While your financial habits and credit history will influence how long it takes, there are some factors that have specific time frames. For example, it takes up to 2 years for a thorough consultation to disappear from your credit report.
As difficult queries are eliminated, your score may increase. Your score also increases the longer you've had credit. Every year you have your credit, your credit history gets longer, helping to improve your score. In your credit report, the number of credit inquiries can provide you with an idea of your score here. That said, as long as you maintain responsible credit habits, you shouldn't worry too much about daily fluctuations in your credit rating. If you have a trusted family member with a good credit score, you have an opportunity to dramatically increase your credit score.
If you want to keep your score in the highest possible credit score range, you'll need to continue practicing good credit habits. If you don't meet the requirements or don't want to use a traditional credit card, you can apply for a secured credit card instead. A credit score of at least 800 has several benefits, including easier loan approval, lower rates, better credit card offers, and lower insurance premiums. If you're overburdened with debt, this can negatively affect your credit rating and make it difficult to obtain an 800 credit rating. It's also a good idea to review your credit reports with all three credit bureaus (Equifax, Experian and TransUnion).In many cases, these are the same benefits that people with very good or excellent credit scores receive but they could be a little better because of their exceptional credit rating. Your utilization rate is calculated for each individual credit card as well as a total for all your credit card accounts. Since payment history represents 35% of the credit score calculation there is a close relationship between having a high credit score and a low number of late payments.
As a result practicing all of these good credit habits over time will help improve your chances of developing excellent credit. Believe it or not millions of Americans have errors in their credit reports and those errors could inadvertently lower their credit rating. In addition to practicing responsible credit habits such as making all your payments on time and paying your balances regularly you'll also want to take some additional steps to improve your chances of getting an 800+credit score. With a credit score higher than that number, you'll receive most of the same benefits as someone with a credit score of 800. Because your credit score is based on information in your credit reports review them to make sure that each one does not contain inaccurate negative information such as late payments or collection accounts.