Not that many people know because it is so rare but your FICO score is able to reach 850. Today we live in a world of instant gratification. GIMME NOW! …….. CHARGE IT!……By having a little self control you too can be in the 800+ credit club

Having a high credit score can drastically save you hundreds of thousands over the years in money from interest from mortgages, credit cards or purchasing a vehicle etc.

1. ON TIME PAYMENTS  – Just paying on time is 35% of your score. NEVER make a late payment. The higher your credit score, the more it can drop with a late payment. It takes a long time to build a high credit score but one late payment can bring you crashing down. I know, I know life’s not fair… ;(
2. UTILIZATION – This is mostly taken into consideration from your revolving debt (credit cards & line of credit). The standard everyone knows is to have your utilization at 30% or less but if you really want to increase your score, have it less than 10%.
   Example: For a $10,000 credit card to have a utilization of 30% or less you need it under a $3,000 balance. Under a 10% or less utilization is  a $1,000 balance or less.
3. INQUIRIES – Inquiries are only 5% of your score. Although this is a smaller factor it’s still important. 72% of people with 800 credit haven’t applied for “credit” in a year. I bet you didn’t know that fact!
4. MIX OF CREDIT – This is most likely the most important and less understood to obtain an 800+ credit score. FICO wants to see that you have a credit mix of BOTH revolving and installment loans.

   Revolving are credit cards or line of credit. Installments vary from personal loans, auto loans, mortgages, student loans etc.
   If you just have one form of credit on your credit report such as just credit cards only, you’re most likely not going to be in the 800 club. A mix shows FICO you’re responsible with EVERY form of credit therefore a higher score like an 800+.

5. NUMBER OF ACCOUNTS – The average 800 credit score has 5 credit cards ALONG WITH a credit mix  of a couple of installment loans (mortgage, auto, student loan, personal loan etc)
6. NEGATIVES – I think it is pretty understood to not have any derogatories/late payments/public records to be in the 800s.  Not even one. If you have a derogatory or late you’re probably going to get knocked down to the 700 club and that’s if you’re lucky.
7. AGE OF ACCOUNTS – Think twice before you cancel your longest credit card! The longer the better is how FICO sees it.

The oldest “average” credit card an 800+ person has is a $19,000 limit credit card and is 10 years old. Some people cut up and cancel their credit cards to get out of debt which is fine but remember FICO wants to see that you’re responsible with this so they give more points to people who have long credit history with credit cards.

-Victor Fernandez