Imperfection of the Perfect Credit Score

The perfect credit score of 850 is a dream of almost everyone. With this score, you can virtually ask for any type of service without having to pay an upfront fee. Companies will be more than happy to do business with you as they have the confidence that you will pay them on time with the right amount of money.

The credit score will also help you lower down your interest not only in your credit cards but in other financial transactions as well. As these lending companies will have a great impression of your paying ability, they will be able to give you a lower interest rate. It is also a matter of competition as companies are constantly looking for customers who can pay them on time with the right amount.

However the perfect score of 850 is almost difficult to achieve. Most financial analysts have confessed that they have yet to see someone come to their office with a score of 850. There could be someone out there or it could just be a myth. The truth is there are only a few people here in the country who actually have a credit rating of 800-825.

If you are really aiming for the score of 850, you have to pay on time and use your credit smartly for decades. But only a few people has that ability and even the rich often hold off payment so that they could properly balance their finances.

The score of 825-850 may not be easily achieved by the good credit rating, on the other hand, is very feasible. A good credit rating (those form 650 up) could still provide you with the services that you need. Lending companies often set a threshold of interest rates they could provide to their customers.

Usually, customers that have a credit rating of 750 will enjoy the same interest rate from those who has a credit rating of 825. The services that you will need also treat you the same way like you have a credit rating of 825 and up. There is still no upfront fee and the interest rate is still lower compared to those who are in bad credit.

Maintaining Credit Score

When you have reached a credit rating of 650, do not slack off and go on credit for a very long time. Every month, your FICO score is updated so you can easily go from good credit to bad credit rating in just one month. If you want to maintain and even increase your credit rating, here are some ideas:

1. Use only a small amount of credit available for you – One of the main reasons why people get lower credit scores is their inability to pay their debts on time. If you want to maintain your credit score, use only a small amount of your available credit so that you can pay them on time. This will show the lending company that you are using their services and paying them on time.

2. Use your credit as the last resort – When you have something really important to do and you do not have time, cash is not really an option. Use the credit card instead. Since you are only using them as a safe back-up plan, you cannot easily max out your credit and lower your credit score.

3. Get an updated credit report – A way of preventing bad credit status is to know your credit rating monthly. There are companies that provide monthly updates either by mail or email. It may cost you a little bit but if you are serious of your credit rating, you need to have the latest information regarding yourself.