We found a lot of people getting 850 credit scores, by doing some easy steps. But some people also do not understand how to get a high credit score up to 850.
An 850 credit score on the FICO score scale of 300-850 is considered exceptional. People with this credit score are likely to be offered some of the best interest rates and terms on credit cards and loans. Applicants with scores in this range are at the top of the list for the best rates from lenders.
To get the perfect 850, don't even think about carrying a balance on your cards. You need to be at or close to zero percent. You've shown a long history of good behavior. If you apply for credit too often, have limited credit score information or have a young credit report then you're not going to max out your score.
As a reminder, your credit score is based on 6 different factors:
If you have not checked your credit score recently, Karma Credit is a free resource. Many credit card companies such as American Express, Discover, and Citi offer free credit reports in your portal account.
Details:
To get a score of 850, you should get a very good score in each category.
Fixed in the 0-9% range. Let's say you have a credit card with a $ 1,000 credit line, and your statement is at the end of the month. If you wait until the end of the month to pay it off, it affects your usage.
A good way to reduce use without changing your spending habits is to pay off your balance before the statement closes.
If you make a prepayment on your balance, do not zero your use. Leave a small balance to pay off when the statement is closed to have a balance because it reflects in payment history.
Your pre-payment card may seem unnecessary, but I think it makes sense because you are aware of your spending habits.
If you are someone who carries a balance every month, pay attention to your expenses and try to see what you can reduce.
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| 850 credit score |
What is a Good FICO Score Range
An 850 credit score on the FICO score scale of 300-850 is considered exceptional. People with this credit score are likely to be offered some of the best interest rates and terms on credit cards and loans. Applicants with scores in this range are at the top of the list for the best rates from lenders.
To get the perfect 850, don't even think about carrying a balance on your cards. You need to be at or close to zero percent. You've shown a long history of good behavior. If you apply for credit too often, have limited credit score information or have a young credit report then you're not going to max out your score.
What are The Parameters of Good and Bad Credit
Today, we'll search for all the variables that affect your credit score and how to optimize it.As a reminder, your credit score is based on 6 different factors:
If you have not checked your credit score recently, Karma Credit is a free resource. Many credit card companies such as American Express, Discover, and Citi offer free credit reports in your portal account.
Details:
- Utilization = 30%
- Payment history and derogatory marks = 35%
- Average age of accounts = 15%
- Total accounts = 10%
- Credit inquiries = 10%
To get a score of 850, you should get a very good score in each category.
Utilization
Fixed in the 0-9% range. Let's say you have a credit card with a $ 1,000 credit line, and your statement is at the end of the month. If you wait until the end of the month to pay it off, it affects your usage.
A good way to reduce use without changing your spending habits is to pay off your balance before the statement closes.
If you make a prepayment on your balance, do not zero your use. Leave a small balance to pay off when the statement is closed to have a balance because it reflects in payment history.
Your pre-payment card may seem unnecessary, but I think it makes sense because you are aware of your spending habits.
If you are someone who carries a balance every month, pay attention to your expenses and try to see what you can reduce.
Payment History
You need 100% to get "Very Good." Payment history is relatively easy: pay your bills on time. Payment history can be difficult if you missed payments in the past. As long as you pay the minimum balance required for a credit card, you'll be fine for this category.
If you missed a single payment, then it has lowered the payment value to "Good."
On time payments
_______________________ = Payment history
Total number of payments
The problem with having only one credit card is the loss of one payment puts you in "bad payment history": 23 payment time / 24 total payout = 96% (Very bad).
This means the mistakes you made two years ago will affect you today if you have one card. Even in the third year, any missed payments will still affect you. Only after the third year, credit score recovered: 35 timely payments / 36 total payments = 97% (Poor)
If you run a situation with five cards instead of 1 card, that's more forgiving:
59 payment on time / 60 total payment amount = 98% (Enough)
The main takeaway does not miss any payouts. If you missed a payment, you can get more credit cards to offset the damage (pay them off completely).
A good way to make sure you do not miss a payment is by automating them. You can choose to pay the card completely or pay the minimum.
Derogatory Marks
Failing on a credit card is an easy way to destroy your credit score, as well as any banking relationship. For example, if you default to a card from a publisher, you may not be able to receive other products from it. They can also end their banking relationship with you as well.
Unlike payment history, this is easier to fix. You may be able to negotiate a payment plan with the bank to get back on track.
Average Age of Credit History, Total Accounts, and Credit Inquiries
Average age of accounts: higher is better. You must reach 9+ years to get an "Extraordinary" score.
Total accounts: You need 21+ accounts to get an "Extraordinary" score. If you have 20 cards and low usage, you are considered more responsible to the credit agent. I realize that 21+ cards sounds ridiculous, but hey, I do not make rules.
Credit Inquiries: Special tough questions every time you apply for a new credit card. When you rent a house, and they run a credit check, it's a gentle question. Applying for a credit card or car loan is a difficult question because you will collect the debt. The interesting thing about the credit question is that your report falls after two years.
For example, if I apply for 20 credit cards in a year, it is 20 questions. After two years, they fell like they were not there in the first place.
These three factors work together. You can take the approach to take one step back to take ten steps forward in the future.
How to Get a Perfect 850 Credit Score
If you go after 850 (again, perfect score does not matter) then you will want to get 21 credit cards as soon as possible and wait. You will soon be taking 21 questions, which will lower your credit score for the next two years. After the two year mark, all questions will fall out.
With your 21 credit cards, make sure you do not miss any payments. Utilization does not matter because you can fix it in the future. Arrange 21 credit cards set aside for nine years to calculate the average age of the account.
Starting from the 8 year mark, make sure your utilization is low. Most likely, you are a financially responsible person if you can be approved for 21 cards.
At the nine-year mark, you will have a low utilization, 100% payment history, 0 disparagement, 9+ average account age, 21+ total accounts, and 0 questions. It's like baking a complicated birthday cake so you have to wait nine years to eat.
Read Also :
How to get a perfect 900 credit score
5 Best Credit Card For Bad Credit No Deposit
What Bills Affect My Credit Score? - You Need To Know it
Read Also :
How to get a perfect 900 credit score
5 Best Credit Card For Bad Credit No Deposit
What Bills Affect My Credit Score? - You Need To Know it
Question: What do you get for having a credit score of 850?
Answer: None. You will receive the same benefits and interest rate as someone with a credit score of 750.
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