There are huge benefits to having a perfect credit score. You can easily approach lenders with confidence, and they will be willing to offer you the best loan packages available along with other incentives. It would be the ideal credit transaction on both ends.

While achieving that score is worthy of aspiring, it is not always easy. In the FICO scoring model, there are only about 1.2% of Americans that have this score. If you maintain a positive credit behavior but have a score nowhere near 850, know that you don’t need a perfect score to have access to good credit deals. Scores above 700 are also considered good by most lenders.


What is a Perfect Credit Score?

What may be considered a perfect credit score varies depending on the type of loan you are applying for. In general, 850 is the highest number one can achieve within a credit scoring system. For specialized industry scores, 900 is considered the perfect credit score.

A perfect credit score is likewise considered exceptional. You are seen as credit-worthy with very low risk of default. Because of this, you have higher chances of being approved for any type of loan, apart from being offered the best packages available.


Benefits of a Perfect Credit Score

With discipline and dedication, a perfect credit score of 850 is achievable. Having a perfect score opens a lot of attractive financing opportunities. But for practical reasons, creditors also consider any FICO or VantageScore that starts with 800 as exceptional. This score, to them, is also a score of excellent credit that can likewise take advantage of these benefits:

  • Access to a wide range of loan products. Borrowers with exceptional scores can expect the best rates and possible longer-term on their loan application.
  • Higher credit limit. Borrowers can bargain for higher credit limits on credit cards and loans
  • The best rewards program available for credit cards. Rewards in cash or kind mean additional savings for you
  • Insurance discounts. You can buy the best insurance package for the least amount of money.
  • More housing options. An exceptional score helps you get approved easily by landlords on rental apartments of your choice.
  • Savings on security deposits. You are waived of security deposits on utility plans or cellphone contracts.


Is the Perfect Credit Score Necessary?

Creditors will not always require you to have a perfect credit score to be granted a good deal on loan applications. Because credit scores are categorized in ranges — like in “exceptional” for scores 800 to 850 — they don’t always distinguish the scores in terms of figures.

Also, depending on the creditor you are dealing with, a score of 700 is already considered good. If your score is above 760, then you will most likely already qualify for the best interest terms.


highest possible credit score

Factors That Influence a Credit Score

Your credit score is influenced by many factors that showcase your credit management. Each of these factors carries a percentage weight that influences how your score is calculated. FICO and VantageScore scoring models use these 5 important factors in determining your score.

Factors FICO Score
Payment History – The record of your payments made on time without fail 35%
Utilization Rate – The total amount of your credit you are using against your total credit limit. A good credit utilization rate is 30% 30%
Length of credit history – The length of time you have credit with different creditors and their individual status 15%
New Credit – The number of times you made hard inquiries or applied for a new credit account 10%
Credit Mix – The different types of credit accounts that you have such as mortgages, credit card, auto, and installment loan among others 10%


How to get an Excellent Credit Score

The strategies often told to help you improve your credit score are the same strategies used in obtaining an excellent credit score. Pay attention to your credit behaviors and disciplines and remember that they greatly influence your credit score.

Here are the ways to help keep a high score or get an excellent credit score: 

  • Pay your bills on time. Make sure you get credit from your creditors each time you pay your bills on time.
  • Keep your credit balances low. When you have gained additional capacity, pay your credit cards in higher amounts to reduce your outstanding balance.
  • Keep your old accounts open. Old accounts with positive credit activity earn you a positive mark in your credit score.
  • Maintain a good credit utilization ratio. Maintain a credit utilization ratio of 30% at all times.
  • Avoid hard inquiries and apply for multiple loans at once – You earn a negative mark when you apply for different loans at the same time.

A perfect credit score of 850 comes with plenty of financial benefits, but it is not always a realistic goal. Even those who have achieved it find it challenging to stay on that level of excellence. Whatever your current credit score is, focus on improving it by following a strict regime of the above points.

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