How to Get an 850 Credit Score: Your Guide to The Perfect Credit Score

Lenders use credit scores to assess your loan applications and determine what type of financing you can obtain. That’s just the tip of the iceberg for how your credit score can impact your finances. A higher credit score will help you borrow more money, score lower interest rates and tap into additional benefits. Your score can range anywhere from 300 to 850, and while it’s not easy to get a perfect score, it is possible. This guide will walk you through some of the strategies you can use to obtain a coveted 850 credit score.

Is it Possible to Get an 850 Credit Score?

It is possible to get an 850 credit score, but it will require patience and discipline. You have to master the five key components that make up your credit score. These are the areas you have to master on the path to an 850 credit score:

• Payment history (35% of your FICO score): Pay all of your credit card bills and other expenses on time. If you miss the deadline, resolve it as quickly as possible.
• Amounts owed (30% of your FICO score): This metric focuses on your credit utilization ratio, which should be between 0% and 10% if you want an 850 credit score. You will have to wipe out your credit card debt and other credit limits.
• Length of credit history (15% of your FICO score): You can’t do too much about this one. Just keep your old accounts open and let time take its course.
• New credit accounts (10% of your FICO score): Opening new credit lines helps, but you don’t want to do it too often. Opening too many credit lines will result in numerous hard credit checks, which will hurt your score in the short run.
• Credit mix (10% of your FICO score): Having various types of debt tells credit bureaus that you can juggle multiple obligations. Don’t accrue debt just for the sake of it, but if you have various loans and credit lines, you can benefit from a good credit mix.

How to Get an 850 Credit Score: 7 Foolproof Tips

An 850 credit score is the pinnacle of achievement for credit building. These seven tips can help you on the path to a perfect credit score.

1. Manage Debt Properly

Effective debt management helps you stay on top of bills and maintain a low credit utilization ratio. Those two components make up 65% of your credit score and demonstrate that you can stay on top of financial commitments. Consumers should make more than the minimum monthly payment on their credit cards to lower their credit utilization ratios. If you already have significant debt, you may want to consider a debt consolidation loan. This financial product lets you group your high-interest debts into a single loan with a lower interest rate.

2. Don’t Close Your Accounts

Old credit accounts still help your credit score. These accounts increase your credit age, a component that makes up 15% of your credit score. Credit card issuers can close your account due to inactivity. If you want to avoid that scenario without turning your old card into your main credit card, you can add one monthly subscription to your credit card. That one subscription will ensure your old credit account remains active.

3. Have a Good Credit Mix

You shouldn’t get into debt just for the sake of it, but if you get multiple types of loans to cover large purchases, your credit score can increase. Credit mix makes up 10% of your credit score and rewards consumers who have multiple types of loans and credit sources.

4. Monitor Your Credit

Periodically reviewing your credit score can help you see progress and strengthen your discipline. You can also see unauthorized charges as they happen and report them before they impact your score and result in other issues.

5. Improve Your Spending Habits

Better spending habits help you stay on top of debt as it arrives. Not only will you stay on top of current obligations, but you will have more money left over because you aren’t spending as much of it. It is a good idea to review your recent credit card and bank account statements to see what happens to your money. You may discover an unused subscription that you have been paying for several months and other opportunities to reduce your expenses. Knowing your financial goals and creating a plan around them can strengthen your spending habits.

6. Check for Errors on Your Credit Report

The major credit bureaus do their best to accurately report information, but they can make mistakes. Consumers have the right to view a free copy of their credit reports each year from each of the bureaus. If you space out your requests, you can get a free copy of your report from one of the three major credit bureaus every four months. If you detect any errors, give the credit bureau a call and let it know. If one credit bureau makes the changes, the other two bureaus will automatically follow suit. You should only report errors if they are legitimate errors and you can demonstrate that they are errors. You cannot report a legitimate late payment or something similar as an error and get it removed.

7. Don’t Apply for Too Many Accounts at Once

Applying for too many loans and lines of credit can trigger multiple hard credit checks. Each of these hard credit checks will lower your credit score. While it’s easy to recover from a single hard credit inquiry, racking them up can be troubling for your credit score. Hard credit inquiries are even worse if your score is barely within a lender’s minimum requirement.

Benefits of Getting an 850 Credit Score 

An 850 credit score is the top of the mountain for credit building, but why should consumers aspire to attain this number? A high credit score presents several benefits and can help you save a lot of money.

Access to the Best Interest Rates

Consumers with higher credit scores get the best interest rates on mortgages, auto loans, personal loans and other financial products. Lower interest rates reduce your monthly payments and give you more flexibility in your budget. 

Easier Loan Approval

Lenders have credit score requirements for borrowers who want to get financing. Fulfilling the minimum can help you get a loan, but the bank may not want to give you much capital if you barely achieve the minimum requirement. Borrowers with 850 credit scores tend to get higher loan amounts because lenders see them as more reliable borrowers.

Higher Credit Limits

Borrowers who demonstrate effective credit management can access higher credit limits. Some financial institutions voluntarily raise credit limits based on a consumer’s history of making on-time payments.

The Path to an 850 Credit Score Starts Now

An 850 credit score is a great goal and can set you up for more opportunities. While it’s the pinnacle of credit-building success, you can get most of the same benefits with a credit score above 800. Building your credit takes time, but credit bureaus will reward your patience and discipline.

Frequently Asked Questions