FICO score is a person's capacity to borrow money or pay off his or her debts. FICO credit scores range from 300 to 850; a better score reduces the credit risk. Considered a quite strong credit score, an 800 FICO will place you among the best credit risks. But is the 800 FICO score classed as excellent or bad? Now let's examine the specifics.
Although the actual top limit tends to be very flexible and depends on other factors, such as geographical location, a decent FICO score in practice looks to be something like 740 or above.
While 800 and beyond is regarded as exceptional, a FICO score of 740 to 799 is normally recognized as rather acceptable. Consequently, one may classify a FICO score of 800 as either outstanding or perhaps extraordinary. This implies to lenders that, given loans or other credit, you are quite unlikely to pay back all that money. Paying their bills on time, using a few credit cards, and not being prone to borrow extensively help this group of people to have minimal credit risks.
Advantages of Having an 800 Credit Score
There are several benefits of having a FICO score of 800 as regards credit and loans. Here are some of the key benefits:
Better Interest Rates and Terms: By accomplishing an 800 score, you will be able to obtain the lowest interest rates from the lenders, below 5% for large loans such as mortgage credit and car credit. You will also qualify for the most preferred loan terms such as a low down payment and other fees. This saves you thousands on average, over the life of larger loan products.
Higher Credit Limits: Considering the low risk the credit card companies and other lenders have in extending credit to you, they will allow you to qualify for larger credit limits. This can be more helpful in terms of flexibility in your spending and not being rigid when you have some big expenses occasionally.
Easier Approval: You will never be declined any loan or credit card you apply for with an 800 credit score. You will have the flexibility of being able to access the broadest array of credit instruments. Banks that offer credit facilities fight hard to secure those customers who have a good credit rating.
Insurance Discounts: Credit-based insurance scores are frequently applied to home and auto insurance policies by insurers. High credit ratings can significantly reduce your insurance premiums annually.
Security Deposit Waivers: Phone companies, landlords, and other utilities will generally demand security deposits from those with low credit ratings. However, they can often afford to ignore such deposits when a client has such a marvelous FICO score as 800, for example.
Is 800 Too High? Any Downsides?
The quick response to this question is that having a good credit score seems to have no drawbacks. Generally speaking, there is no issue with having a better FICO score as long as you are comfortable with taking on more debt and you are confident you can pay all the outstanding amounts on time.
One tiny worry one can have about an eight hundred is that it cannot be raised much higher. Someone with a FICO score of 760 nevertheless can reach the highest score of 850. Still, once you get 800 you have little prospect of climbing further. Your score should therefore stay in that top level as long as you remember to keep up solid credit practices. Still, trying for an 850 score is not realistic or advised.
Ways on How to Achieve and Maintain an 800 Credit Score
The good news is that if you have already achieved an 800 credit score, maintaining it simply involves sticking to the positive financial habits that got you there in the first place: The good news is that if you have already achieved an 800 credit score, maintaining it simply involves sticking to the positive financial habits that got you there in the first place:
- Settle all credit accounts promptly or better still, before the due date monthly.
- On credit cards and other types of revolving credit, try to keep balances low
- Do not apply for new credit for unnecessary reasons as this leads to hard inquiries.
- The next step is to check all open accounts for identity theft or mistakes.
- Let the length of positive credit history gradually continue to grow
If you do not engage in credit risky behaviors your 800+ score should remain quite stable or gradually increase over time. This means that an occasional 30- to 60-day late payment can reduce your score by several dozen points. However, your previous record of being responsible will overcome that lapse in many instances.
The Bottom Line
Thus, a FICO credit score of 800 belongs to the highest credit score range, which is associated with the lowest credit risk. It has several benefits such as getting to work with the most favorable rates and terms from the lenders who want your custom. It is therefore important to continue practicing proper credit behaviors to keep an 800+ score steady in the future. It is quite difficult to find any disadvantage of having such a high credit score. Although 850 is ideal, there is no denying that a FICO score of 800 is even better.
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