Consumer Comeback Blog

How to Get a Perfect Credit Score

Written by Jeffrey Trull

bullseyeMany blogs discuss the difference between a good and a bad credit score. But what about going from a good score to an excellent or even perfect credit score?

A “perfect” FICO credit score of 850 points might be nearly impossible to obtain, but moving above 800 may be nearly as good.

Credit scores this high don’t come without effort. Instead, they’re earned by those that truly understand how credit works and what they must do to maximize their score.

If you already have great credit, here’s how to get a perfect credit score or come close to it.

Avoid any mistakes

Going for near-perfect credit requires just that when it comes to paying your bills and making sure you don’t make mistakes. There’s simply no room for even a single late payment or other misstep that can lower your credit score.

To avoid any risk of negatives on your credit report, there are a few tricks that those with excellent scores use, like:

  • Automatically paying bills. When you don’t leave payments to memory, you don’t have to worry about forgetting when a bill is due and missing a payment.
  • Pay credit card bills every week instead of waiting for statements. Paying bills more frequently means you’ll never miss due dates. You’ll also keep the outstanding debt that’s reported with every statement low if your balance is already brought down before the billing period ends.
  • Monitor credit using mobile or web apps. Services like Mint can remind you of bills as well as help you keep track of credit card spending.

Don’t forget that any mistakes on your credit report can’t be erased by you or a credit repair company. You may dispute errors, but only for actual mistakes — not if you’re just looking to clear up problems in your past.

Find errors

Errors on your credit report can make a big difference in your score. One writer increased her score by more than 100 points by disputing errors.

Check your credit report at least once a year. Errors might not always be as glaring as a fraudulent account, and even small issues can have an impact. You could look for any of the following:

  • Incorrect dates
  • Missing accounts, accounts that don’t belong to you, or duplicate accounts
  • Incorrect information about delinquent accounts or missed payments
  • Incorrect personal information
  • Negative information more than seven years old

You can dispute credit report errors simply by writing a letter, which will trigger an investigation by the credit bureaus.

Build a solid history

A long credit history is a key to success for many that have an excellent credit score. Age is on your side, and maintaining excellent credit over decades rather than just years helps build a solid score.

If you’re young, start building good credit as early as possible. Develop good habits from the start and keep them while gradually increasing the number of accounts on your credit report. You’ll be rewarded later in life if you do.

Pay off balances

Those with the highest credit scores excel in all areas of how a score is calculated. This includes credit utilization ratio, which is the comparison of credit in use and your total available credit line.

Those with the best credit scores often have many open accounts with large amounts of credit available. The trick is they don’t use much of it.

Paying off all your balances and having a utilization close to zero is best. Even having a utilization of up to about 10% may be okay. But beyond that, your credit score may start to suffer.

Showing that you can handle a large amount of credit and not go overboard makes you appear to be a less risky borrower, which is favorable for your credit score.

Keep in mind that your credit utilization may be calculated when a statement is issued or possibly more frequently. This means even if you pay off your bills completely and on time, your credit utilization can still increase within the billing cycle.

Diversify credit history

Having a variety of loans in your credit portfolio is helpful. This includes installment loans, like auto loans and mortgages that have a fixed payment with a fixed end date. Revolving credit, which primarily relates to credit cards, is an important aspect of your credit score, too.

A good mix could include around five revolving or credit card accounts along with one installment loan that’s kept in good standing. Lines of credit that are at least 10 years old or more will help you inch closer towards a perfect credit score.

Be careful with inquiries

Inquiries only have a small effect on credit, but when you’re going for perfection, every bit counts.

Good credit or not, you need to be careful with credit inquiries. Specifically, too many at once can signal risky behavior and drop your score a few points. Experts recommend that you keep inquiries to three or less within a six-month period.