How to Get a Credit Score Above 800 in 4 Steps

Credit scores range from 300 to 850, and to get the best rate on a credit card, car loan, mortgage, or other debt, you generally need a high credit score of at least 720 to 760. Having a credit score above 800 points is classified as an “excellent” score by the scoring algorithms. This elite status allows for easier access to bonus rewards cards, low-interest loans, and hassle-free apartment finding.

Most lenders use credit score formulas from Fair Isaac Corporation, aka FICO. Your FICO score is based on factors such as your payment history, types of credit, how often you apply for new credit, and your credit usage, which is the amount of credit you are using divided by the amount of credit which you have. This data comes from the three major credit bureaus: Experian, TransUnion and Equifax.

If all of this sounds daunting and confusing, don’t worry! There’s actually an incredibly simple system you can use to improve your credit score. Here’s how it works:

1. Commit to paying off your debt

The good news is that you don’t have to be debt free to improve your credit score. However, you must commit to paying off your credit card debt and find a repayment strategy that you can stick to. Credit cards have some of the highest interest rates overall, so it’s a good idea to wipe off as much of your credit card debt as possible, even if you’re not worried about your credit score. credit.

Reducing your debt helps improve your use of credit because your balance is a smaller share of your available credit. “Paying down your balance is the best thing a cardholder can do to boost their credit score from ‘good’ to ‘great’,” said Matt Schulz, chief credit analyst at LendingTree. Ideally, keep your usage rate to no more than 30% of your available balance. People with the highest scores tend to keep their ratio below 10%.

Even after resetting your balances, keep your old credit cards open. Why? Credit score algorithms take into account the length of your credit history, so an older card in good standing helps. Plus, having that unused line of credit can keep your utilization rate low.

2. Start using your credit cards like a debit card

Although you should avoid using a credit card for large and extravagant purchases that you cannot otherwise afford, it can be a good idea to use credit cards for everyday purchases like groceries, gas , invoices and subscriptions. If you continue to pay off your debts, do so on a separate card to avoid having a balance.

How can this spend swap benefit your score? It prevents card issuers from closing cards or reducing credit limits due to inactivity. And when you pay down your balance each month (more on that in Step 4), it shows you can use credit responsibly.

3. Set up automatic payments

This is the most important step in the process. Missing a single payment can affect your credit score and lead to interest, so set up automatic payments to make sure your credit card bill, student loans, and other debts are paid on time. Once you’ve set up your automatic payments, check that they’re scheduled correctly and on time. Once you double check, triple check.

Your payment history is the biggest influence on the score, accounting for 35%. Paying your bills on time is therefore a great help, even if you are unable to pay your balance in full.

It’s also a good idea to check your credit report to make sure it accurately reflects your good conduct. About 1 in 5 consumers have an error on their report, according to the Federal Trade Commission. You can get a copy of your report at AnnualCreditReport.com.

4. Pay off your credit card balance in full every billing cycle

Set up your automatic payments to pay the full balance each billing cycle. If you use your credit card instead of your debit card, you should only spend the amount you know you can repay each month.

While it can be painful to watch your checking account pay out hundreds or thousands of dollars at the end of each month, remember that this is money you would be spending anyway, just in smaller increments. and more frequent.

‘Queer Eye’ star Bobby Berk used a twist on this step to boost his credit score by 150 points, “from the low 700s to 840 or 845.” Berk sets its automatic payments to zero out its balance a few days before the statement period closes.

“I went from feeling like I maxed out my card every month, even though I paid for it, to only using 10% of my debt ratio, which is a big chunk of your score” , did he declare.

That’s all, that’s the whole thing. Your credit score should start improving quickly, and before you know it, you’ll be eligible for better rates and great rewards cards. With a credit score of 800, you can use your rewards cards for first-class flight upgrades, free hotel rooms, and cash back on groceries and memberships. Even better, you can get these great benefits without paying a single dollar in interest.