Achieving An Excellent Credit Score

So what is an excellent credit score, exactly?

An excellent credit score is a 760, according to the FICO credit score scale.  Getting an excellent credit score is something we all want.  But, how do you do it?

Pay everything on time

The first and most important thing to get you an excellent credit score will be to pay all your bills on time.  Never be late!   Even one day late can seriously impact your credit score, especially if its on a credit card.  People with excellent credit scores always pay their bills on time, and this is a great credit fix over time for people poor credit.

Maintaining variety

Another important point is maintaining variety.  You want to keep a variety of credit lines open.  And, too many of one type of credit is bad as well.  For example, somebody who has nine credit cards should consider reducing that number down to two or three.  Somebody, on the other hand, who has two credit cards, an auto loan, and a mortgage has a much more balanced, healthier credit portfolio.  His or her credit score is likely, leaving out other factors, to be higher than the person who had nine credit cards.

Keeping non-revolving non-mortgage balances low

You’ll want to keep how much you owe down to a minimum.  Typically, you don’t want to owe less than a thousand dollars on any installment loan, such as furniture or appliance loans.  Many people do not realize this affects their credit score, but it does have an effect, a rather significant one.

Keeping revolving credit balances below seven percent of limit

You never want to max out your credit cards; in fact, you never want to have the balance go over seven percent.  You can achieve a good credit score if your balance is below thirty percent, and in fact, most credit building sources suggest that thirty percent is the cap that you should not go over.  However, if you pull up your FICO report and are over seven percent, it will show that your high revolving credit is negatively affecting your credit score, and it will tell you that FICO high achievers keep below seven percent.  So, stay below it!

Patience is a virtue

A large part of your credit score is the length of your credit history.  So, if you’re young, there’s not much you can do to get an excellent credit score – it’s not yet time to ask “how can I improve my credit score“.   You can have a score in the low seven hundreds, which is not quite an excellent credit score number or in the excellent credit score range, but it is very good.  After just a couple years of credit building you’ll be able to find easy to get student credit cards if you’re still a student, and gain more rewards and better rates, because you’ll have an excellent score.  Use your credit cards as a credit history build and try to pay them off in full on time, every time as much as you can.

Now you can enjoy the fruits of your hard labor working away from your ho-hum, run-of-the-mill average credit score, and on your way to a near perfect credit score.  Excellent credit score mortgage rates are much better, so buy yourself a house!

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