Are you tired of your low credit score? Do you want to improve this? Learn how to get an 800 credit score and maintain it up there in the next few steps.
Whenever the word credit comes up, so does credit score. Whether you seek a personal loan, an auto loan, or a home equity loan, lenders will always want to know your credit score. This is the measure of your creditworthiness, as rated by various credit scoring agencies.
Generally, the main credit scoring agencies like FICO and VantageScore put this score between 350 and 850. 350 is the lowest score and 850 the highest. The higher your credit score is, the better your chances are of getting your loan application approved.
So, how hard is it to hit that high score?
Well, your credit score is determined by various factors, including payment history, credit mix, credit utilization, etc. Credit scoring agencies get this data from the credit bureaus like Experian, Equifax, and TransUnion, to help give you a score.
The fact is achieving a high credit score isn’t easy, as it’s also not too complicated. Today, we explore various strategies on how to get 800 credit score and above. Therefore, if you seek to manage your personal finance and improve your credit score, here is what you need to do.
Table of Contents
Best Tips on How to Get 800 Credit Score
1. Commit to Reduce your Debt
Paying down your debt is one of the easiest ways to improve your credit score. Luckily, this doesn’t mean having zero debt. In fact, having some debt that you can comfortably pay promptly is encouraged.
The trick here is to reduce your huge debts into amounts that don’t hurt your personal finances. For instance, credit cards accrue quite high interest rates. For this reason, reducing your credit card debt will certainly favor your finances and your credit score as well.
With credit cards, credit utilization is crucial. This is the ratio of how much credit you owe on your card against your total credit limit. Experts advise that this ratio shouldn’t be more than 30% of your total limit. In fact, borrowers with the highest credit score tend to maintain a credit utilization ratio below 10%.
However, as mentioned earlier, don’t close your account or stop utilizing your credit limit. Keeping these accounts active is also crucial to your credit score as various scoring algorithms use your credit history length when giving you a score.
Generally, the older your credit history is, the better are your chances of getting a higher score. So, if you want an easy strategy on how to get 800 credit score or above, try paying down those debts.
2. Use your Credit Card as a Debit Card
Now, this one seems to go against the rules. However, it certainly doesn’t, if you know how to go about it.
First, as per our first tip, avoid using your credit card for purchases that you can’t afford, leading to overspending. But, since there are expenses that you must incur every month, like gas, groceries, subscriptions, and utility bills, using a credit card on these might be helpful.
But how? Well, these are expenses that you usually clear at the end of every month. This means that despite using your credit card throughout the month, the closing balance is always low, and the card is always active. This alone ensures that issuers don’t reduce your credit limit or close the card citing inactivity.
One thing to note, though! If you have committed to reducing your debt balance, use a different credit card for your daily purchases. This will help you avoid keeping a balance.
3. Set Up Automatic Payments
How about automating all your debt payments? This is undoubtedly one of the best strategies on how to increase credit score to 800.
As we have seen over and over, late payments will always have a negative impact on your credit score. Not only that, you’ll have to pay more due to the late payment interest charged.
Setting up automatic payments helps ensure that your payments or installments are paid on time, avoiding fines or interest rise. You should do this for all your credit card debts, student loans, personal loans, mortgage, etc.
After setting up the automatic payments, don’t forget to ensure that they are scheduled on the correct dates. You don’t want to incur those unexpected penalty costs or a reduced credit score.
Also, when calculating your FICO score, your payments history accounts for around 35%. This makes it the biggest determining factor of your credit score. Therefore, ensuring that the payments are made on time helps keep that record clean and attractive.
By setting automatic payments, you also relieve yourself of the burden of remembering the exact dates for each payment.
4. Clear your Credit Card Balance with Each Billing Cycle
Besides the automatic payments, you should also ensure that you don’t have a credit card balance at the end of your billing cycle. For instance, assuming you used your credit card as a debit card, as suggested earlier, ensure that all the debt is cleared every month. This means you should avoid making purchases that might go beyond your monthly income.
The fact is there is no silver bullet in achieving a higher credit score. And, learning how to how to get 800 credit score requires you to combine various strategies to get there. Knowing the right mix and understanding how each strategy helps your credit score is thus quite important.
I know that seeing all that cash getting deducted from your account isn’t easy. However, remember that you’ve already used that money and you have a similar chance in the coming month. And, the results on your credit score are also impressive.
More Strategies on how to Achieve 800 Credit Score
5. Grow Your Credit History
As mentioned earlier, various factors determine your credit score. Your credit history’s length is one such factor, accounting for 15% of the entire score. This means that attaining that 800 score is impossible without factoring in the length of your credit history.
Therefore, the only solution is to build and grow that credit history over time. One incredible place to start is taking a student loan or a credit-builder loan.
For student loans, you don’t require a credit check as most of them are federal funding. This makes it an ideal option for students without any prior credit history.
On the other hand, a credit-builder loan acts as a saving account. You get the loan but can’t access it until you’ve paid all the necessary installments to clear the loan. Once you’re through with the installments, you can now access your money. While it’s a personal loan, it helps build a saving culture while also growing your credit history.
Applying for a credit card can also help grow your credit history. And, if you don’t qualify for an unsecured one, you can start with a secured one and grow your way up from there. A secured credit card requires a cash deposit as collateral.
See related: How to Save Money Fast on a Low Income.
6. Always Review Your Credit Reports and Credit Score
One thing you must always do is to keep tabs on your credit reports and credit score. You don’t want to do everything right, only to discover that your efforts don’t reflect on your credit score report. A report by the Federal Trade Commission showed that 1 in every 5 consumers get an error on their credit report.
Checking your credit score is easy with the numerous free credit scoring websites available. With some of these websites, you get more than just your credit score progress. They give recommendations and tips on how you can increase your credit score.
Typically, your credit score is calculated from your credit reports, listed on the credit bureaus. Reviewing these reports helps you ascertain they are accurate and that the credit-scoring agencies get the correct information. Inaccurate data, such as an indication of late payment, can hurt your credit score.
If you want to check your reports for free, you can visit AnnualCreditReport.com.
7. Diversify your Borrowing
When calculating your credit score, having one line of credit doesn’t augur nicely with the scoring algorithms. They love diversity! This means they want to see you repaying several loans such as an auto loan, mortgage, credit card, student loan, etc.
By doing so, you are displaying your paying capability, which acts in your favor when calculating your credit score. For instance, having several credit cards can help you cover your monthly expenses while still maintaining a low utilization ratio. This wouldn’t be the case with one card as you would have to spend above the 30% limit.
However, always remember to make the payments in good time. While diversity is recommended, it might strain your finances, leading to late installments and debt repayments.
So, if you are wondering how to get 800 credit score in 45 days or less, following these incredible tips can get you there. All in all, loans diversity is one of the most effective strategies.
How Long Does it Take to Build a Credit Score?
Building credit is easy if you follow the right strategies. However, it’s never instant.
For new borrowers, it takes around six months before you can even get your first score. But, with the strategies mentioned above, you can easily increase your ratings and achieve that 800 credit score mark or higher.
All you need is to ensure that you have the financial discipline and that every financial decision you make is well thought through. To get a more comprehensive overview of how much time you need, you can go through our article on how long it takes to build credit.
How often is Credit Score Updated?
Generally, lenders submit your credit data to the credit reporting bureaus on a monthly basis, although some may do it more frequently. There are also others that submit the information after at least 45 days.
This data is the one that credit scoring agencies like FICO pick up to adjust your credit score. This means that once the credit reporting bureaus receive the information and update the credit report, that’s the only time that FICO or any other credit scoring agency can update your credit score.
Therefore while it might not appear on your weekly reports, the change in your score will appear in at least 45 days.
Benefits of an 800 Credit Score
After working so hard to learn how to get 800 credit score and eventually achieving it, how does it help? How do you benefit from the high credit score?
Higher Chances of Loan Approval
With a credit score of 800, you only need to meet the other lender’s requirements, like income level and maximum debt balance. Otherwise, the lender will be quick to approve your application.
Better Interest Rates
A high credit score means a lower risk to the lender. For this reason, they are willing to give you the best rates available as they are almost sure that you will repay the debt. And, in good time!
Better Credit Card Offers
Learning how to get 800 credit score is not in vain. With such a credit score, even credit card issuers are ready to offer you better interest offers. For instance, you qualify for the free-interest promotions, which allow you to use the credit card for even up to 21 months, interest-free. But you must be able to repay the entire balance before the end of the promotion.
If you love traveling, you might also enjoy using some incredible travel cards, offering the best discounts and bonuses. But you must also meet the requirements.
Discounted Insurance Premiums
Some insurance companies will include your credit score in their premiums calculations. With a higher credit score, you might be able to enjoy lower premiums. This, however, depends on whether your state allows such kinds of premium calculations.
How to Maintain an 800 Credit Score
Achieving the 800 credit score mark is one thing; maintaining it up there is another. But this shouldn’t be a bummer for you.
While the credit score might fluctuate a bit, you can maintain it above 800. All you need to do is continue doing what gave you that high mark. Maintain the good financial habits mentioned above, and you’ll be good to go.
At least you now know how to get 800 credit score.
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