Hey, It’s Wes Roth here to help answer “How to Increase Credit Score to 800?”
Today I will show you the real truth about how to build your credit fast, from scratch and how to get it to 800 and above.
After working at a bank for a number of years and also dealing with a lot of bankers to finance my business and real estate deals, I can tell you that a lot of the content about credit scores that is out there is watered down and the really effective methods aren’t usually mentioned.
Here is the video where I walk you through my strategies on how to increase credit score to 800.
So let’s get started. First we’ll start with some basic things you should do, kinda like brushing your teeth everyday, it’s just something you should be doing, it’s a basic necessity.
At the end of this article, we will go over some ninja tactics that don’t get talked about quite as much.
How Long Does It Take To Go To a 800 Credit Score?
So first, some good news. If you have scores in the fair or bad range, if you follow these tips, you can see some dramatic results fast, which means getting access to better loans and credit card as well as better terms.
So if you are starting from the bottom, you can quickly rack up 100 point increases within 2-3 months while if you already have a good score, it’s more about consistently polishing and optimizing it and improving it over time.
Check Your Credit Report
The best advice I can give for people starting to look into this is to sign up for a FREE (make sure it’s FREE) credit monitoring service. It used to be that this was almost impossible to get and would often cost money, but today there are services that are free and easy to use.
I’ve used Credit Karma, they are not paying to say this. I’ve used them for years, I’ve recommended them to all my family members. It’s 100% free, I just log in every few months and just go over the reports to make sure everything is looking good.
I’ll put a link in the description, sign up asap, you don’t need a credit card, they make their money by recommending you products that you might find useful, but they are not annoying about it, which is nice.
Credit Score Factors
Here are the things that you should be paying attention to when it comes to your credit.
Payment history, this accounts for 35% of your score
Amounts owed this accounts for (30%) of your score
Length of credit history this accounts for (15%) of your score
New credit this accounts for (10%) of your score
Credit mix this accounts for (10%) of your score
How To Get Your Credit Score To 800
Don’t worry about what this all means, because basically here’s how to Max these things out. Ready?
Have 2-3 credit cards that you pay on time and keep open for a long time. Keep the balances low and don’t approach the maximum. Anything under 30% is considered good. Meaning that if you have 2 cards each with a $5,000 limit, you total limit is $10,000 so you should attempt to keep the combined balance on the cards to less than $3,000. If you go over your credit score might drop, but once you pay it down, you will see it increase usually within 30 to 60 days. So if you are approaching a time when you need to get a loan, pay down your credit cards about 2 to 3 months before.
Keep your credit cards open for a long time and don’t keep closing them and opening up new ones. As you can see here anything over 7 years on average is really good.
Open New Account Types
That is the bulk of your credit score. To polish it even further you can get additional loans to “mix up” your credit, things like car loans, mortgages, personal loans and lines of credit which shows your proficiency at paying off different types of debt, but this only accounts for about 10% so it’s not something to really worry about.
Ask For a Credit Increase
A great practice to get into is to call your bank every few years and ask for a credit increase, even if you don’t need it. Over time as your credit line increases, it will be easier and easier to keep your outstanding balance under that 30% mark. Don’t worry if they say no, they usually are just following some benchmark they are given, just try again in 6 to 12 months if you are rejected.
But what to do if you score is BAD. How do you improve it if you have no credit or negative marks against you?
Dispute Any Negative Marks
Step one is to dispute any negative marks on your credit reports. Go through Credit Karma or whatever other credit reports you are using find any negative reports against you.
There are 3 main credit bureau agencies These are Equifax, Experian, and TransUnion. They usually have the same information, but not always, so check each one if possible.
If they have negative marks against you should start the process of disputing them. This is one of the thing that doesn’t always get talked about, but it’s important to understand that sometimes you can make these go away even if you deserved to have that on your record. Let’s say you moved out of state and forgot to pay your cable bill, a year went by and the cable company could not find you to get the payment. So they reported the loss to the credit bureau.
You find out about this two years later and begin to dispute this with the credit bureaus as well as the cable company. Due to the regulations and paperwork required for these agencies to provide to you, sometimes they will simply remove these negative marks instead of having to deal with it. This becomes more likely for older items that have been on the credit score for a while. If the company that reported it, can’t come up with documented proof that you missed that payment. There is a chance they will just dismiss it. Human laziness will work in your favor here.
The next step is you have to get credit cards and start using them and gaining credit history. Get any one that you can, or if a bank won’t give you a credit card, you have two other options.
Become An Authorized User
One is to use a secured credit card, where you pay an upfront fee and the deposit amount is usually the same as your credit limit. Or two you can become an authorized user on another person's credit card. They don’t have to give you the card or even reveal the card number, just adding your name to their card can help you start getting credit history.
After 12 months of using a secured card or being an authorized user, try to apply for a regular credit card with you as a signer.
If any of this was beneficial to you, consider subscribing, hit the thumbs up button. Also please comment below with any questions you have about finance, investing, credit or anything else related to money. I read every single one and I will do my best to answer them in the comments or in another video. Thank you.