Perfect Credit Score – Is there a prefect rating when it comes to your credit and FICO score? Well, it depends, and it has a lot to do with how you pay your bills. For example, each consumer can be ranked ranked poor, average, good, and excellent depending on what their report says about them.
A higher rating is following by a better interest rate on mortgages and loans. In fact, most banks like to see a higher number above 800, but most people can’t achieve that. The average consumer has a number between 700 to 740.
A FICO result is calculated based on how you pay your bills on time and other factors that may include money you may owe including card accounts, loans, debts, and any public records such as liens.
The three primary credit reporting agencies are Equifax, Experian, and TransUnion.
A person with a perfect payment history will usually have the highest FICO score. A person with a lower rating can expect to make a higher down payment. However, each bank has their own set of loan approval policies that can be different from one another.
The perfect rating, or the highest, is a number above 850. However, there are ways you can improve the scale by staying out of collections. Make sure those items are paid first because it will impact your file until they are satisfied.
It is possible to improve your file. Collection items can impact it by 50 to 100 points. It doesn’t matter how many items you have, or the number of companies that are on your report, because all you have to do is pay them.
The formula used to calculate a number to determine your score, which has been the best-kept secret. It’s complicated math, but it does measure your history on how you pay your bills. Don’t sweat on trying to get the best rating, it’s not that simple.
You can do things to get closer to the perfect rating as a consumer by keeping your credit card balances low each month. Keep it below 25 percent, it doesn’t have to be prefect, but you will be surprised how much it improve your FICO. Lenders don’t like to see high card balances when you’re applying for a loan.