A Credit Score of 800

What is a credit score?
 

   
Whenever you try to borrow, open a bank account, apply for a credit card, get a mortgage, the first thing the lender will do is to check your credit score. Put simply, a credit score reflects your financial worthiness to potential lenders. If you have a lot of debt and have missed payments on loans or mortgages or credit cards, then your credit score will be low or poor, and you will have difficulty borrowing. If, on the other hand, you have never borrowed, and do not have any credit cards, there is no real record of your ability to meet financial requirements, so your credit score will not be as high as you might expect. Lenders want to see that you have borrowed and met all your payments on time and discharged your debts in a timely fashion. The lowest credit score is 300 the highest is 850, according to the industry standard of scoring, which is the FICO score, created by the Consumer Federation of America and Fair Isaac Corp. A credit score of 800 is, therefore, very good.

What does a credit score of 800 mean?

You will pay lower interest and be seen as less of a risk to a creditor, if your credit score is high. Only 13% of the population has a credit score of 800 or above; the midpoint is 723. There is not one score that is regarded as a cut off point for loans, it varies from industry to industry, and some lenders specialize in borrowers with poor credit, but they will charge very high interest rates. Generally borrowers with scores above 740 receive the best rates, which can make a significant difference to their monthly payments and the overall cost of borrowing. A credit score of 800 is very difficult to achieve, but if your score is currently in the 740 plus range there are actions you can take to reach that elusive high score.

Improving your credit score

Most people are struggling to improve their credit score from the 500 to the 600 range, so when asked by their friends, "is a credit score of 800 good", may be less than positive in their response. However, the following strategies apply, whether you have a credit score of 800 or one of 500. The worst thing you can do to affect your credit score is miss payments on loans or credit cards, so keep those payments on time, set them up to be paid automatically on the due date. Too many applications for credit will lower your score and all applications are recorded. Hopping around from one bank account to another is not good either; if you want a new bank account but have a long history with another bank, consider keeping both and using one for all your regular payments, and one for everyday spending, this may help you to budget. You can improve your credit score, if you know what it is, so order a copy. Then aim for a credit score of 800 in order to get those low interest rates.


  

Source: Credit Cards For People With Bad Credit Rating


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