The Benefits Of An 800 Credit Score
So what exactly do you gain by having an 800 credit score? Is this something you should strive for? Here are three benefits of having an 800 credit score:
- You’re more likely to have your applications approved. Remember that credit scores indicate your creditworthiness. Along with your other financial information, your credit score helps lenders predict whether you’ll repay the money you borrow. With a high credit score, lenders see you as a less risky borrower, increasing the chances that they will approve your credit.
- You’re more likely to qualify for lower interest rates. Your credit score is a major determining factor in the interest rate on loans. Having an 800 credit score will help you qualify for lower interest rates and will save you thousands of dollars over the life of your loan. You’ll see the biggest impact with larger loans that you repay over a longer period of time, such as mortgage and auto loans.
- You’ll receive better credit card offers and pay less in interest. Regardless of credit score, everyone can avoid paying credit card interest by paying their credit card balance in full each month. An 800 credit score can help you qualify for credit cards that offer a 0% promotional rate on purchases and balance transfers. Having one of these credit cards in your wallet gives you the flexibility to carry a credit card balance and pay it off over time while avoiding finance charges on your balance.
Contact Credit Card Issuers For Lower Interest Rates
One of the perks that typically comes with a credit score of at least 800 is a lower interest rate when you apply for a credit card. But what if you can get better interest rates on the you already have?
To get the best interest rate, skip the credit card issuers contact form. Instead, get on the phone and make your case to a real person.
Check Your Credit Reports
Its also a good idea to review your credit reports with the three credit bureaus . Believe it or not, millions of Americans have errors on their credit reportsand those errors could inadvertently lower your credit score.
Make sure all the information on your credit reports is accurate and learn how to dispute credit report errors with the credit bureaus.
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Fundamental Tips For Improving Your Credit
We know that a high credit score is often a requirement to apply for loans, mortgages, and other forms of private financing. In the United States, consumers with good credit scores are more likely to be offered lower interest rates when applying for these forms of credit.
In addition, it takes less time to get approved for a loan with a good score. So if you want to be able to borrow money from various sources in the future, it might be best to start working on your credit now. Improving your credit score can be challenging but not impossible. There are a few things you can do to help improve your credit score.
Length Of Credit History
The length of your credit history represents 15% of your credit score, and having a longer credit history generally helps boost it. In 2019, LendingTree analysts found that consumers with scores above 800 had credit histories of just less than 22 years, on average. In 2021, analysts found that the time frame spiked to an average of more than 27 years.
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My Credit Score Is 800 Now What
by The Ascent Staff | Updated July 21, 2021 – First published on Nov. 16, 2018
Having a credit score of 800 or higher puts you in an elite tier of borrowers, given that only about 20% of people have a credit score in this range. People who have scores above 800 enjoy extraordinary credit card perks, low loan rates, higher borrowing limits, and other financial benefits that aren’t offered to people who have lower credit scores.
Be Mindful Of Your Credit History
How long you’ve managed your credit comprises 15% of your credit score. Typically, the longer your credit history, the higher your credit scores. Credit scoring models may factor in the age of your oldest account, the newest account and the average age of all your accounts.
So before you close a credit account in good standing, make sure you weigh the potential consequences first. Closing the account could reduce the length of your credit history and your overall credit limit, which could hurt your score. If you want to close a credit card you aren’t using to avoid its annual fee, consider asking your card issuer to downgrade you to a card with no annual fee instead.
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Dont Apply For Every Credit Card
Too many credit inquiries in a short period of time can hurt your credit score. This can be difficult to avoid during Christmas when it seems that every department store is offering you a discount for signing up for its credit card.
Applying for new credit card accounts can account for 10% of your credit score, which isnt a huge number, but it can be enough to push you into the 800+ credit score club.
Holly Wolf, who with her husband has a credit score in the 800 range and is a chief marketing officer at Conestoga Bank, says she doesnt open a lot of credit cards and often closes cards she may have opened to get a store discount.
Honestly, this isnt a lifestyle to which most folks aspire, Wolf says. They need to have a nice car a big house and all the accouterments of prosperity over having a high credit score. Living debt-free or with as little debt as possible has enabled us to save for retirement, get the best rates on loans, and be prepared for unexpected expenses when they arise.
How To Maintain An 800 Credit Score
Once you achieve an 800 credit score, your work is far from finished. Your credit score isnt set in stoneit fluctuates based on the factors we discussed above. If you want to keep your score in the highest credit score range possible, youll have to continue practicing good credit habits. This means monitoring your credit score and reports often, keeping your credit utilization low and paying your bills on time.
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Mix And Match Methods Of Borrowing
The algorithms that calculate credit scores love diversity, meaning they smile when they see you paying on a mortgage, car loan, student loan and credit card. What that says to them is that you can multi-task when bill paying time rolls around each month.
Members of the 800 Club, naturally, take it a step further. They average nine open accounts, which does wonders for not just the methods of borrowing, but also helps the credit utilization category immensely.
In most cases, the extra accounts are credit cards and here is how that helps.
As demonstrated above, if you rely on just one credit card to pay for all your expenses, your credit utilization likely is going to 50%-75% or higher. The credit score algorithms dont care that you pay that off every month. They want the credit utilization under 30%.
So add three more cards to your wallet, each with $5,000 limits on them and suddenly your credit utilization is up to $20,000. If you spend the same amount with cards that month, your utilization drops dramatically, probably under 20%.
Not all of us are comfortable carrying that much credit in our pocket so be careful with this one.
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Here are seven ways you can overcome your bad credit and still get that rental youre looking for:
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Is 800 A Good Credit Score To Buy A House
While having a credit score of 800 seems lofty, even scores in the 700’s can help home buyers get lower mortgage rates. Many loan programs have a minimum credit score requirement to get approved for a mortgage. For example, most lenders will require a credit score of 580 to get approved for an FHA loan.
Keep Your Credit Utilization Rate Low
The second most important credit score factor behind payment history is your it accounts for 30% of your credit score. Your credit utilization ratio measures the amount of credit you use vs. your total credit limit. If your total credit limit is $10,000, aim to use no more than 30% of it$3,000. To boost your credit score, keep your ratio closer to 0%, if possible.
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Importance Of Higher Credit Scores
While having a credit score of 800 seems lofty, even scores in the 700s can help home buyers get lower mortgage rates.
Many loan programs have a minimum credit score requirement to get approved for a mortgage. For example, most lenders will require a credit score of 580 to get approved for an FHA loan. Other programs, like USDA mortgages and conventional loans, will require scores of at least 620.
Even though aspiring borrowers only need the minimum amount, a credit score thats well above the minimum requirement can save you money and stress. Your credit history isnt the only criteria that mortgage lenders consider when determining your interest rate, but its a big one.
Your mortgage rate will be determined by the size of your down payment, your debt-to-income ratio, current mortgage rates and your credit score.
For example, a potential homeowner with a credit score of 760 who is planning on making a down payment of 20 percent will have a lower mortgage rate than someone with a score of 620 putting down 10 percent.
The size of the mortgage rate you can get depends on other factors as well, but keeping a high credit score is the best way to ensure buyer-friendly rates.
So Is An 800 Score Worth It
The answer is yes! But a credit score of 750 is probably just as good.
Aiming for 800 and above might be enticing, but its not always necessary, Griffin said. Scores of 800 or above may earn you bragging rights, but they wont net you better terms. Your goal should be to have a score high enough to get you the best rates and scores greater than 750 will qualify you for the best rates.
So, the numbers game for credit scores is like every other statistical measurement in your life: How high is high enough?
If youre happy at 750 and getting the best rates you can go for it!
But if you want to feel like a millionaire without have the bank account to prove it take your best swing at 800 and let the privileges fall where they will!
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How People With Short Credit Histories Can Achieve 800+ Scores
Being older can make it easier to earn a good credit score, as youve had a longer time to achieve a good payment history and to keep accounts open. The oldest active account for those with scores of 800 or higher averages more than 27 years. While younger consumers cant reach such steady account ages just yet, an 800 credit score is still obtainable.
How You Can Get An 800
It depends on whats in your credit profile. Start by performing a free credit score check with Experian and signing up for credit monitoring. You will receive real-time alerts any time changes are made to your credit profile, along with recommendations to help strengthen your credit score. Experian Boost is also a free tool worth considering to improve your score since it adds on-time payments from subscriptions, cell phone, and utility providers to your Experian credit report.
In the meantime, continue with good habits like paying your bills on time and work to reduce your outstanding credit card balance, reducing your credit card debt. You also want to maintain a healthy credit mix of revolving and installment debt and only apply for credit as needed. Also, try not to close credit cards. Doing so could increase your credit utilization ratio, reduce your credit age, or both, which hurts your score.
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Why An 800 Credit Score Is So Good
A score of 800 or above is considered exceptional, and it shows that the person having it is responsible with his/her finances and can be trusted with loans. An 800 credit score is good for a variety of reasons.
For instance, when you have such an amazing score, its more likely for your application to get approved. Your credit score represents your creditworthiness, just like the other financial information on your credit report. When a lender is looking over your history and sees your score, they will be more likely to give you a loan because you seem to be someone who will repay the loan on time. Youre not as risky as someone with bad credit, so your chances of obtaining a loan are instantly higher.
Whats also great with an 800 credit score is the fact that you may get lower interest rates. The credit score is one of the things that contribute to how high your interest rate is going to be. So, if your credit score is 800 or higher, then you will have the chance to get lower interest rates. As a result, you will not have to pay as much as someone with a lower score would. Saving money is a guarantee.
Its also possible to get much better credit card offers and less interest as a result of your outstanding credit rating. If your score is 800, then you may get a credit card with a promotional rate of 0% on balance transfers and purchases. With this card, you can make payments over time and there will be no charges on your balances, which is going to be a great benefit.
Check Your Credit Report Regularly
Another way to improve your credit score is to check your credit report regularly. When you do this, it allows you to catch mistakes in your report. Mistakes do happen, but if you don’t catch them, they can wreak havoc on your credit, making it harder to improve your score and achieve an 800 or higher rating.
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Monitor Your Credit Regularly
Now that youve achieved a credit score to be proud of, the last thing you need is for some identity thief to come along and create a bunch of problems youll have to clean up later. Its easy to keep an eye on your .
You can also subscribe to a paid or monitor your own credit by requesting a free copy of your credit report annually from each of the three nationwide credit bureaus, Experian, Equifax, and TransUnion.
You have a right to an error-free credit report. We have tools that can help
Pay Your Bills On Time Every Time
Perhaps the best way to show lenders you’re a responsible borrower is to pay your bills on time. Payment history is the most crucial factor with the FICO credit scoring models, accounting for 35% of your FICO® Score, so it’s essential you pay your bills on time.
Fortunately, if you fail to pay a bill by its due date, you can correct the mistake and stave off negative consequences to your credit score. Typically, lenders don’t report missed payments to the credit bureaus until they’re 30 days past due, so make sure to pay any outstanding bills before then.
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Only Spend What You Can Afford
Dont use a credit card to live beyond your means, or to roll over the costs of everyday expenses to the next month, Nitzsche recommends. This will only lead to spiraling debt that will be difficult to get out of.
People with an 800+ credit score dont apply for more credit than they can afford and dont spend more than they earn.
While using a credit card for everyday expenses is OK if you can pay the credit card bill off in full each month while gaining awards points in the process, dont let the accumulation of points convince you to spend more, Nitzsche says. And if youre running to your credit card when your car, refrigerator, or something else breaks down, start an emergency fund to pay for such repairs.
Bill Balderaz, president of Fathom Healthcare, has an excellent credit score and attributes it to his family living below their means. As our income rises, we keep our spending flat, Balderaz says.
They also pay off all credit card bills each month, pay off their vehicle loans early, and have paid off their mortgage early to help get them to an 800+ credit score.
Their excellent credit score has allowed them to get the most preferred loan rate. After three houses and eight vehicles, Balderaz estimates theyve saved tens of thousands of dollars on loans by getting the lowest loan rates.