The Anatomy of an 800 FICO Score

A decent credit score can open the door to many financial benefits. But, with just a “decent” score your options are still going to be capped. If, however, you can get to elite status, the perks include the cheapest money, more money, less restrictive terms, cheaper insurance, and that’s not all. So what’s the anatomy of an 800 FICO score?

According to FICO, my former employer, a credit score of 800-850 is exceptional. Just over 20% of Americans enjoy this badge of honor. If you want to earn an 800+ FICO score of your own, you’re going to want to emulate the credit behaviors and habits of others who have already achieved this elite status.

1. Build a good foundation

If you want to build an 800+ FICO score it’s important to establish a positive credit history as early as possible. Having either no credit or a thin credit file can hold you back in the credit score department. You simply aren’t going to approach 800 with a limited credit report.

Note that if you trying to overcome past credit problems or you don’t have any established credit history, you may want to consider applying for accounts that match your eligibility level. Secured credit cards and credit builder loans may work well if you’re in a no credit or bad credit situation at present. If this is the case then you’re going to need to be patient, as your journey to 800+ is going to take longer.

2. Pay on time, always and without exception, ever

I’m not sure how I can be more emphatic on this point. The presence of negative information accounts for 35% of your FICO score points. Late payments showing up on your credit reports are going to point your scores in the wrong direction.

According to FICO, 95% of people with 800+ FICO scores have zero late payments on their credit reports. Additionally, only 0.5% of consumers with 800+ FICO scores have a credit report with a collection account. What this all means is the chance of you hitting 800 with derogatory entries is next to impossible, but you probably already knew that.

3. Keep your credit card utilization ratios below 10%

Another detail that affects your credit scores is your credit card utilization ratios. When your credit report shows that you’re using a larger percentage of your available credit card limits, the utilization ratio on the accounts increases. Unfortunately, higher credit card utilization numbers can trigger a drop in your credit score.

The way you manage your credit cards may have a bigger impact on your credit score than you realize. With FICO scores, 30% of your score comes from factors that pertain to the amount of debt you owe (per your credit report). Credit utilization is one of the factors that influence your credit score most within this category, but not the only factor. And because this article is about how to earn and maintain 800s, and not 700s, you’re going to need to keep those ratios below 10% and limit the number of accounts with balances.

4. Apply for and open new accounts judiciously

You should be wise about when you apply for and open new accounts if you want to earn elite credit scores. But, the idea that you need to avoid applying for and opening new accounts to earn an 800-credit score is incorrect.

You don’t need to be afraid to apply for new credit when you want a new loan, credit card, etc.—as long as you exercise control. People with high credit scores still seek credit. In fact, FICO says that the overall credit behaviors of the different credit score groups (i.e., applying for new credit and opening new tradelines) aren’t all that different within this area. But, if you want to max out your scores you should avoid polluting your credit reports with new accounts because it’s going to reduce your average age of accounts, an important factor in FICO’s scores.

Bottom Line

This article is about how to earn 800+ FICO scores, not how to earn “decent” or “good” scores. That’s an entirely different article where there are tolerances to how well you have to adhere to the aforementioned advice. So, if any of you are asking out loud, “but what if I just have one default?” or, “but what if that wasn’t my fault?”, the answer is likely “sorry, this isn’t about good scores, it’s about elite scores.”

If you’re able to do all the things listed above, you’re going to have elite-level scores. Why are you going to have elite scores? You’re going to have elite scores because the things I list above are the blueprint to proper credit management, and FICO will reward you for proper credit management.