So is 800 a good credit score? Well according to Fair Isaac (developer of FICO) only 13% of Americans have a credit score above 800. When you consider the national average is 692 and the median is 723, being in the 800 and over crowd is an exclusive club indeed. But how do you get there?
If you want to know how to get a 800 credit score, you should go straight to the horse’s mouth….
- MyFICO – This is FICO’s site for consumers. Yeah, a lot of it is trying to sell you on their credit score monitoring services – but aside from that – there’s a great deal of free information in the education and community sections of their site.
- Members of the 800 club – Know someone with a FICO score in this range? Grill them on the types of accounts they have, their credit utilization, payment history, and more. Want someone to start with? Well in a recent post I wrote about my credit score of 790 which you may find useful (used to be 800 before some recent credit inquiries were made).
Is that too much work? Okay, here’s a cheat sheet for you...
If you don’t want to spend your waking hours scouring the MyFICO site and interrogating those who already have a high score, I’ve created the following cheat sheet just for you.
This information is derived from the clues that MyFICO gives about so called “High Achievers” which are those with a score of 760-850, as well as my own experience and knowledge.
1. Age of accounts
Unfortunately this is one of the few things that you can’t control. Just like you can’t accelerate the aging of a fine wine, nor can you speed up the clock on the age of your credit account.
The oldest revolving account (translation: credit card) for the “high achievers” is pegged at 19 years on average. Furthermore, the average age across all their accounts is between 6 and 12 years.
What does this mean? Age discrimination that’s 100% legal! Even though I first hit 800 in my mid-twenties, that is extremely rare and for most, they may not hit that number ‘til their thirties.
2. Bad debt
Collection or public record on your file? On MyFICO it says that “virtually no” high achievers will have that. So even if you do everything else right, don’t think you can get away with having that one ER bill charged off or that old credit card from 5 years ago in collections.
Don’t get me wrong, you can have charged off debt and a few years later, it might be possible to have a FICO in the mid-700’s. But if you are shooting for a credit score over 800, then you need to seriously do whatever it takes to prevent charge-offs, or if they’re already on there, find a way to get them removed.
3. Number of accounts
According to a post by a MyFICO moderator, 6 accounts currently being paid as agreed is the average for high achievers. Moreover, there’s an average of 4 to 5 credit cards on file (which includes accounts both currently open and those that have been closed but are still on the report). Just a little FYI though - I have many, MANY times more cards than that!
So for all the haters out there that love to harp about how evil credit cards are… just remember, when used responsibly, they can be quite helpful for your credit score! If you honestly think you’re going to get to 800 and above by only having a student loan and car loan on record, then I have some swampland in Florida I would like to sell you.
4. Mix of credit
It used to be that you could obtain a killer score with just cards or just loans, but when the formula was tweaked a few years back that all changed.
If you want to know how to get an 800+ credit score nowadays, then you need to acknowledge and accept the fact that a good mix of different credit accounts is imperative:
- Revolving accounts – This is primarily credit cards
- Installment accounts – Loans where you pay a fixed amount each month. Think mortgage, car loan, etc.
Those are the two main categories and then within each, there are also variations which can affect your creditworthiness. For example, TransUnion considers a bankcard with a credit line of $10,000+ as being a “premium bankcard account.”
Since FICO’s formula is secret, no one knows exactly how they gauge the importance of a given credit limit of something like a “premium bankcard account.” But one thing is for sure and that is I’ve never seen someone with an 800 score that only has toy limits of one or two thousand. So don’t play around, play with the big boys and get some five-figure fun for your credit limits.
5. Payment History
Depending on the source you reference, having even just one 30-day late payment reportedly may knock down your score by up to 60-120 points (the higher your score is, the greater the fall). And the higher you are to begin with, the longer it will take to recover (it might be years).
Now just to clarify – as I constantly hear confusion about this – any payment that is up to 30 days late can be treated as a 30 day late payment. You see, the “30 day late” actually covers everything from 1 to 30 days late.
That being said, even though creditors have the right to report all non-paid accounts as late the day after the due date, that is extremely rare. Most won’t report it as late unless it’s not received by the next due date, however don’t bet the ranch on that because every lender operates differently (so be safe and pay on time).
6. Credit Inquires
Every time you apply for some form of credit, whether it be a credit card, mortgage or loan, a “hard” credit inquiry is made. This hard inquiry is recorded on your credit report. It stays on there for 24 months but will only be able to affect your score for the first 12 months (with the greatest impact during the first 6).
The MyFICO moderator posted that for the high achievers category, 72% didn’t apply for credit in the past year. That being said, you can most definitely have an 800+ score even with inquiries affecting it. You just don’t want to have too many. From my experience anything beyond 3 per year is a no-no if you want to keep your score above 800 (mine dropped to 790 from having that).
Last but not least, we come to credit utilization – the percentage of a credit limit (or loan) which is being used. It has been a hotly debated topic at CreditCardForum on multiple occasions.
If you go by the high achievers, then the average is 7% on the revolving accounts (a.k.a. credit card accounts). And indeed, this is right in the neighborhood of mine which came in at 6% last time.
One of the lesser talked about forms of utilization is that which applies to installment loans. The MyFICO moderator highlights that of a loan’s original amount, for the high achievers an average of 35% has been paid down.
When you think about it, the installment loan utilization rate probably correlates closely with the average homeowner who bailed on their underwater mortgage during this real estate crisis. Why? Because those underwater were much more likely to be (a) recent buyers before the bubble burst, and/or (b) people who bought with little to nothing down. It makes sense that someone who has already paid off 35% of their mortgage is far more likely to stay in their house and keep paying.
One last important note – credit scores are not created equal!
I bet you 10 to 1 that sooner or later, some doofus will post a comment below saying something like “I have a 880 credit score” or “I’m only 20 and my credit score is already above 800.”
Well FYI, most credit scores which are peddled to consumers these days are imitators to FICO and are drastically different. FICO runs 300 to 850. There are a ton of others out there, like VantageScore, that run 501 to 990. Then there are those which aim to “simulate” FICO and might do a poor job at that – I've heard them being off as much as 70 or 80 points.
Best cards for beefing up your report?
Below are some good ones that have a reputation for giving respectable credit limits. It's a good idea to have accounts with different banks. For example, if you already use Chase and AmEx, get a Discover and Capital One.
I got to almost an 800 in my early 20's using just cards alone (I had about 10). Having several with respectable credit limits seems to go a long way in FICO's eyes.
This post was written or last updated October 16, 2013