Consider this if you would like to improve an 850 FICO score.

Is it possible to reach a perfect score? One of the most widely used credit score scales, FICO, has it as 850. However, there are many more scoring models used to calculate your score, and the problem is, that while your score is perfect according to one model, it might be different with another ther one.

The advantages of reaching a perfect or excellent score (750) are plentiful. Lenders will be fighting for your business, offering the best interest rates. As a result, you will get the lowest long-term mortgage and loan costs.

Well, although an ideal score is next to impossible to attain, there is a definite percentage of consumers who are able to reach this mark. It is, however, one in 200 hundred consumers who reaches a perfect or excellent score: it takes a lot of effort and time.

Here are some tips that are supposed to help customers to make their wish come true.

1. Make sure you pay your bills on time

It certainly goes without saying that bills have to be paid on time, as it reflects your payment history, and, consequently, results in your FICO credit score. It is known that approximately 35% of your score is based on your payment history. The more late payments or collections a customer has, the lower his or her credit score is.

However, if late payments are of a one-off nature, it is advisable to ask your lender to forgive it (provided that the payment has been made). Since we do miss payments from time to time, lenders meet customers' requirements; in fact, it is easier and cheaper to retain a customer than to acquire a new one.

2. Make your payment automatic

You might as well set up automatic payments for your credit accounts. When you have your bills either charged to your credit card or automatically paid on a specific date, you will never be late on paying your bills.

There is one more way not to be late with your payments. It is paying your bills through your bank online. In this case you are bound to make a payment on the due date. Apart from that, online payment is fast and hassle-free.

3. No need to carry your balance

It would be appropriate to pay off your credit cards regularly every month, as in this case you are sure to improve your credit score in the long run. Paying off your credit cards in full or a certain period of time will help you to lower the cost of the acquired goods and services because you don't have to pay any interest. The aggregate credit utilization, which makes about 30% of your FICO credit score, also gets lower in this case.

4. Check your credit score two or three times a year

There is one more common failing - trying to stay on top of your credit score by all the means. Well, don't. The matter is, lenders use your credit score as a financial indicator used to make a decision whether you are creditworthy, and if you are, what interest rates you may be qualified for. So, for lenders to make a precise picture of you as a borrower, it takes a lot of information. Moreover, due to the fact that the length of your credit history comprises approximately 15% of your FICO credit score, it will take a lot of time, years, in fact, to achieve an 850 credit score. Make sure that your credit score checks will happen two or three times a year.

5. Increase your credit limit

There is no need to be afraid of increasing your credit limit, especially if you are a wise spender. The model is like this: the higher your credit limits are, the fewer chances for you to spend more than 30% of your aggregate credit, which is a crucial point for your credit score. Of course, it might look complicated for your lender at first, but in due course it is sure to lower your credit utilization rate and, in the long run, to have a positive effect on your credit score.

6. You can lower your interest rate

Should you ask your lender to lower your interest rate? Strange as it might seem, the idea looks quite feasible. Do not be afraid to hear "no", since lenders spend much more money to get new customers than to retain the old ones, especially the ones with a positive credit score.

7. Do not close your good-standing accounts

One more common misconception is when consumers close their good-standing credit accounts. Why? They mistakenly think that the fewer accounts they have, the more responsible borrowers they are.

In fact, it is not the way it works. It is only 15 % of your credit score that makes the length of your credit accounts. It is strongly recommended to use your good-standing accounts once or twice a year to make sure they have not been closed.

8. Reasons for setting up an account

While striving for an 850 FICO credit score make sure that your new credit account should be set up only when it is reasonable; it might be an extremely large purchase, e.g. buying a property. That is opening credit accounts just for the sake of saving petty cash does not make any sense.

9. What to focus on first

First things first. Paying off your revolving debt has to be of the utmost importance. As a matter of fact, when FICO calculates your score, it takes into account the type of debt you pay. These debts are revolving and installment ones. As for revolving debts, their interest rates are usually higher and the amount you pay is calculated on the amount you owe. Installment loans, however, are fixed ones, they have a longer time period.

10. Annual credit report check

Finally, pay attention to the fact that once a year you can check your credit report free of charge from each of the three credit bureaus. Why is it necessary to do it? To make sure there are no mistakes on your report.