Credit score..a perfect one

[Anonymous]

Anonymous wrote:Absolutely ZERO debt, score 805.

You've probably had debt in the past. People with zero debt who have no debt and no credit history generally have worse scores. The credit rating system is an evaluation of what type of credit risk you will be. A score says that you assume debt and pay it responsibly, on time and in full, plus you have sufficient assets that you can make the payments without struggling. If you have zero debt and very little credit history, then it is hard for lenders to evaluate whether you'll be a safe risk to lend to, as it will be hard to tell if you have a pattern of paying responsibly and on time.

[Anonymous]

Anonymous wrote:

Anonymous wrote:It’s all such a mystery. I’ve been married with joint finances for 18 years. I’ve been a SAHM for the last 14. DH has an 810 and I have an 830 even though every single bill we’ve paid for 14 years was with only money earned by him. We rotate whose name we open the CC’s so we can churn the bonuses more quickly.

Explain to me how you open new CC's for the bonus: how often do you do this, do you cancel an old card when you open a new one, opening a card lowers score so how long before it goes back up, etc etc.
I never actively did open cards for bonuses, so I wonder if its worth the time and effort. Thanks. Also, are any particular bonuses the best?

PP here. So for example, some credit card bonuses stipulate that the same person cannot collect the signup bonus for a certain card again until the previous account has been closed more than 24 months. Different cards have different rules about how many you can have open at once, how often you can apply for a new one, etc. We certainly don’t maximize the way some people do - there are whole forums dedicated to people playing this game - I’m sure someone who knows more than I do can point you to a better reference.

[Anonymous]

Missing word.

Anonymous wrote:

Anonymous wrote:Absolutely ZERO debt, score 805.

You've probably had debt in the past. People with zero debt who have no debt and no credit history generally have worse scores. The credit rating system is an evaluation of what type of credit risk you will be. A high score says that you assume debt and pay it responsibly, on time and in full, plus you have sufficient assets that you can make the payments without struggling. If you have zero debt and very little credit history, then it is hard for lenders to evaluate whether you'll be a safe risk to lend to, as it will be hard to tell if you have a pattern of paying responsibly and on time.

[Anonymous]

Anonymous wrote:Absolutely ZERO debt, score 805.

So, never a single credit card?

Unless you pre fund the credit card and spend against your deposits, you have some debt, even if you pay it off when the bills arrives.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Absolutely ZERO debt, score 805.

You've probably had debt in the past. People with zero debt who have no debt and no credit history generally have worse scores. The credit rating system is an evaluation of what type of credit risk you will be. A score says that you assume debt and pay it responsibly, on time and in full, plus you have sufficient assets that you can make the payments without struggling. If you have zero debt and very little credit history, then it is hard for lenders to evaluate whether you'll be a safe risk to lend to, as it will be hard to tell if you have a pattern of paying responsibly and on time.

+1 I had zero debt up until a few years ago when I noticed my credit score was starting to drop. Got a few credit cards and it’s slowly inching up.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Absolutely ZERO debt, score 805.

You've probably had debt in the past. People with zero debt who have no debt and no credit history generally have worse scores. The credit rating system is an evaluation of what type of credit risk you will be. A score says that you assume debt and pay it responsibly, on time and in full, plus you have sufficient assets that you can make the payments without struggling. If you have zero debt and very little credit history, then it is hard for lenders to evaluate whether you'll be a safe risk to lend to, as it will be hard to tell if you have a pattern of paying responsibly and on time.

Have you responded to several posts? I swear you (and the other posts essentially saying the same thing) are the only one who understands what a credit score is about. All of these “0 debt” and “husband earns the money” posts really shows that people are off-base about what the credit score is for and what metrics go into the algorithm.

[Anonymous]

Anonymous wrote:Just for fun, how can I get my credit score at 850? Is it possible to do that?

The score is 830 now, and I dont understand why its not 850. No debt, everything paid on time forever.

Credit utilization comes into play. Even if you pay your credit card off every month, if you have a balance when they run their algorithm it will affect your score very slightly. In months when I’ve charged a large item my credit score dips by 5 or ten points. If you want to avoid that you can pay it off immediately instead of waiting til the end of the cycle. But with a credit score over 800 there’s no actual reason to do so.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Just for fun, how can I get my credit score at 850? Is it possible to do that?

The score is 830 now, and I dont understand why its not 850. No debt, everything paid on time forever.

Credit utilization comes into play. Even if you pay your credit card off every month, if you have a balance when they run their algorithm it will affect your score very slightly. In months when I’ve charged a large item my credit score dips by 5 or ten points. If you want to avoid that you can pay it off immediately instead of waiting til the end of the cycle. But with a credit score over 800 there’s no actual reason to do so.

OP. Yes, I have noticed when we have a large purchase or two, our credit score dips, then goes up in 2 months or so. Very interesting, this whole credit score phenomenon.

Also, it is good to know if you charge a huge purchase, it is a good idea to pay off right away instead of waiting till statement time, that way you preserve your score.

And it is only during the pandemic that I became interested in our credit scores (both are high), every time I check my credit card charges, I look! Before pandemic, I never bothered to look.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Just for fun, how can I get my credit score at 850? Is it possible to do that?

The score is 830 now, and I dont understand why its not 850. No debt, everything paid on time forever.

Credit utilization comes into play. Even if you pay your credit card off every month, if you have a balance when they run their algorithm it will affect your score very slightly. In months when I’ve charged a large item my credit score dips by 5 or ten points. If you want to avoid that you can pay it off immediately instead of waiting til the end of the cycle. But with a credit score over 800 there’s no actual reason to do so.

OP. Yes, I have noticed when we have a large purchase or two, our credit score dips, then goes up in 2 months or so. Very interesting, this whole credit score phenomenon.

Also, it is good to know if you charge a huge purchase, it is a good idea to pay off right away instead of waiting till statement time, that way you preserve your score.

And it is only during the pandemic that I became interested in our credit scores (both are high), every time I check my credit card charges, I look! Before pandemic, I never bothered to look.

Why in the world would you pay something off earlier to prevent a theoretical credit score dip? A credit score is absolutely meaningless until you need to apply for credit. Even then, it's only your score band that counts. Anything over 800 is the same for credit purposes.

There's no award in life for a perfect credit score.

Anywho, the credit monitoring 'credit score' is fake. What counts is the actual FICO score calculated by your lender, which may vary based on which model they use.

[Anonymous]

op, my reply to last poster just above. Interesting info, thanks for the advice!

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Absolutely ZERO debt, score 805.

You've probably had debt in the past. People with zero debt who have no debt and no credit history generally have worse scores. The credit rating system is an evaluation of what type of credit risk you will be. A score says that you assume debt and pay it responsibly, on time and in full, plus you have sufficient assets that you can make the payments without struggling. If you have zero debt and very little credit history, then it is hard for lenders to evaluate whether you'll be a safe risk to lend to, as it will be hard to tell if you have a pattern of paying responsibly and on time.

Have you responded to several posts? I swear you (and the other posts essentially saying the same thing) are the only one who understands what a credit score is about. All of these “0 debt” and “husband earns the money” posts really shows that people are off-base about what the credit score is for and what metrics go into the algorithm.

Nope. This was my only response to this thread. I understand credit because I'm old. I am in my late 50's and had my first credit card when I was 18. My father got us a joint credit card in my name (he was essentially a co-signator). I would buy books and have various expenses that he would pay that I could charge to the card and he would pay. But, I could also charge other things that I could pay myself. He also got us a joint checking account that I used to pay my tuition and such. My father taught me about finances, how to monitor your finances to make sure you could pay what you spent and how to track and pay what was used in a checking account and on cards. And he taught me about credit scores and ratings and what they meant and what they were used for.

I'm so glad he taught me all that. I knew friends that even after college, had no idea how credit works, like some of the other posters on this thread.

[Anonymous]

OP - Why do you care? Your score is good. Why chase perfect?

[Anonymous]

I've scored 850 two months running. Mortgage less than $600k now; no more student debt; cars paid for; regularly about $3k on credit cards that mostly gets paid off each month (sometimes we carry over the balance, which I know is not wise).

[Anonymous]

Mine varies between 820 and 840, depending on which service and when I pay off my bill each month. Based on the info Mint gives me, it seems I don’t have enough credit accounts to have a perfect score. I have a mortgage and two credit cards. I have had student loans, car loans in the past, and have a long credit history, but apparently should have more accounts for a perfect score. But I’m not in the hunt for an 850.

[Anonymous]

I had one for a bit. Had a mortgage (two maybe - can't remember the sequence) with okay savings and no debt but about $100k in CC usage a year. It's doable.