How common is an 800 credit score?

Posted on: 30 Jul 2024

A credit score is one of the most valuable figures in an individual’s financial life. It usually falls between 300 and 850, and the ability to secure a good credit score informs lenders that you’re a responsible debtor who manages your debts well. It is significant to note that 800 is regarded as an excellent credit score but how frequent is this?

The FICO score is the most widely used credit score and was created by the Fair Isaac Corporation. In the survey conducted by FICO, it was revealed that only 1. 4% of the consumers had an 800+ credit score as per the data of 2019. Thus, while a score as high as this is undeniably good, it is not something that is frequently achieved. Scoring in the mid-700s will place you far above the average.

Why Is An 800 Credit Score So Rare

To reach 800, a credit history must be clean, and a consumer must have used credits responsibly for years. This means having no payment that was made a day or later, having a credit utilization ratio below 10%, having credit cards, personal loans, and student loans, and credit checks having been run not more than six times within the last year. An 800 scorer has probably been a credit user for more than 10 years and has never paid any due date late or had cards charged to the maximum limit. Even though they are eligible for large credit lines, they do not have large credit limits.

Such a borrower also has several types of credit and actively uses them – credit cards, auto loans, mortgages, etc., but does not accumulate too much debt. They use credit cards sparingly and avoid applying for credit multiple times and getting rejected. They maintain these habits so as not to compromise their score and keep it in that 790s to 800 range.

In other words, the ability to attain an 800 credit score requires discipline, among other things. It means positively proving over several years that one can manage credit appropriately. Many folks make occasional mistakes because they are poor or because they are not very attentive. However, 800 scorers are almost free from credit imperfections.

To what percentage of the population does it rise to this very high score?

As highlighted earlier, only 1. 4% of consumers end up getting to 800+ according to FICO at any given period. Fair Isaac also tracks the prevalence of other credit scores: Fair Isaac also tracks the prevalence of other credit scores:

850 to 799: 1. 4%
760 to 799: 9. 36%
700 to 759: 15,63
650 to 699: 17. 78%

So, when you get to 700, you are doing more than 65 percent of the American population. The top level is even higher – and when you achieve an 800 club and above, you’re almost completely set apart. However, only one in twenty are fortunate enough to reach this stage. Another factor is geography. The scores of states like Minnesota and Vermont are comparatively much higher. They also seem to outcompete rural areas like the rural areas in Minneapolis and Boston.

However, even in the most competitive metro areas, about 2-3 percent of the people have FICOs above 800. Thus, no matter where you live in the USA, such a score keeps you in the elite of creditworthy people.

Which Age Group Tends to Achieve 800 Scores

It is not a surprise that the likelihood of achieving the FICO scale’s 800 is highest among older Americans. Experian credit report database revealed that only 0. 3 percent of consumers below the age of 34 had FICO scores above 800 in 2015. For people between the ages of 35 and 44 years, the rate was slightly higher at 0. 8%. The following are some reasons why young borrowers stand lower odds of securing such loans:

First is simply time. The longer you have been living, the more time you have to work on creating an excellent credit history. Do not worry because it was mentioned that one needs years of good behavior to eliminate the effects of bad behavior you once exhibited. Also, younger adults on average have: Also, younger adults on average have:

More hard inquiries negatively affect their scores
This means that the credit utilization ratios were even higher.
Fewer numbers of credit accounts are offered in the market.

Hence, they begin a little slow in the basic FICO elements that include the payment history, the amounts owed, the length of credit history, recent credits, and the credit mix. However, that does not mean getting the 800+ score is unattainable for individuals under the age of 35. It just requires methodically avoiding such detrimental actions or contents in one’s daily life.

Thus, people aged 45-54 get 800+ scores with a frequency of over 2%. Among the 55-64 years old, it is a little over 4% and for the 45-54 years old, it is a little over 3%. It is over 20 times higher than the under-35 set and for the seniors 65+, it is more than 6%. Once again, as evidenced above, it is clear that a high credit rating is normally associated with many years of experience.

What Does This Mean for Borrowers

The best borrowing privileges are availed by those who score 800 and above. You can get rewards credit cards with amazing offers including sign-up bonuses, hotel status, and zero percent balance transfer rates. Auto loans and mortgages are no exception, and lenders will ensure that they offer the lowest possible rates to attract customers.

However, to get very good credit opportunities, you don’t have to score as high as 710. Even if your score is just hovering above 700, as it is for more than 30% of Americans, you’ll still be able to easily obtain loans with low interest rates.

So, the message is that if you get 800, you get the best rates, but if you are far from this number, you are still able to find quite cheap borrowing. Thus, one can conclude that a high credit score is useful but not necessary for financial success. Staying above 700 on the scale will allow you to get most loans and credit cards with good terms.