H Credit Guide

How Long Does It Take To Get 800 Credit Score

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A high credit score can be extremely beneficial when applying for loans, renting an apartment, or obtaining a mortgage. Even more opportunities may be available to you if your credit score is exceptional or excellent and falls between 800 and 850. However, improving your score isn’t always as simple as it sounds.

The credit reports of 100,000 LendingTree users with credit scores of at least 800 were anonymized, and our researchers examined them to provide insight into what it takes to receive an exceptional score. Here’s what habits they had in common.

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  • All of the individuals in our sample of LendingTree users who have a credit score of 800 or higher pay their bills on time each month. Payment history accounts for 33.5 percent of a credit score, making it the most significant factor.
  • The average amount of debt held by Americans with credit scores of 800 or higher, including mortgages, is $150,270. That’s up 8. 8% from May 2021. Millennials have the highest average debt right now ($197,082), while Gen Zers have the lowest average debt ($51,693). The average monthly payment made by these Americans with the best credit scores is $1,556. Amounts owed account for 30% of consumers’ credit scores.
  • For those with scores above 800, the oldest active account is on average almost 22 years old, which is a substantial decrease from 2021. We discovered in May that the oldest active account on average was over 27 years old. Even though they are older than Gen Zers, millennials currently have the lowest average age—less than 15 years old. Thirdly, the length of credit history (15%) is the most significant factor in a credit score.
  • Consumers with 800-plus credit scores have an average of 8. 3 open accounts — similar to 7. 9 in 2021. Gen Xers now have 8. The average number of open accounts is six, the highest of all the generations. Although payment history or outstanding amounts are more significant, credit mix accounts account for 2010% of consumers’ E2%80%99% credit scores.
  • These Americans with high scores are limiting credit card inquiries. Americans who have at least an 800 credit score have seen an average of just 1. 8 credit inquiries in the past two years. New credit accounts are updated for 2010% of your credit score, and new inquiries are kept on file for two years on your credit report.

100% of sampled users with credit scores of 800+ pay their bills on time every month

Customers with outstanding credit scores have one thing in common: they pay their bills on time (Amy, let me see you there). Additionally, they consistently pay their bills on time each month, accounting for E2%80%94%20100% of our sample of LendingTree users with credit scores of at least 800.

Payment history makes up 35% of a credit score. Given that payment history accounts for the majority of a credit score, it should come as no surprise that all high-score customers pay their bills on time. As a matter of fact, when we conducted this study in 2019 (and again in 202021), 10% of consumers with exceptional credit scores paid their bills on time.

How much debt do Americans with 800+ scores have?

The average amount of debt held by customers with excellent credit scores, including mortgages, is $150,270, an increase of 8 8% from May 2021. Today, millennials between the ages of 26 and 41 have the highest average debt, at $197,082. Meanwhile, the youngest age group has the least debt. Gen Zers between the ages of 18 and 25 owe $51,693 on average.

Everyone Gen Zers Millennials Gen Xers Baby boomers Silent generation
$150,270 $51,693 $197,082 $193,051 $114,848 $66,593

Source: Analysis of anonymized credit reports of 100,000 LendingTree users

According to Matt Schulz, chief credit analyst at LendingTree, rising debt is a result of inflation. “Due to the Federal Reserve’s seven interest rate hikes over the past year, borrowing has become significantly more expensive,” he claims. It is simple to understand why some people would be struggling with more debt today than they were last year when you combine that with inflation. ”.

Generation Xers, who are between the ages of 42 and 57, have the highest average credit card debt balances. A previous LendingTree study on credit card balances found that Gen X cardholders have $6,527 on average. With an average credit card balance of $1,857, Gen Zers have the lowest balances yet again.

These customers are paying a lot because they owe such large sums of money, and not just on their credit cards. The average monthly payment for high-score customers across a range of products is $1,556. Millennials have the most debt (about $4,000 more than Gen Xers), but Gen Xers make the highest monthly payments, averaging $1,985. On the other hand, Gen Zers are the lowest payers, averaging only $506 per month.

Everyone Gen Zers Millennials Gen Xers Baby boomers Silent generation
$1,556 $506 $1,732 $1,985 $1,309 $715

Source: Analysis of anonymized credit reports of 100,000 LendingTree users

The second most significant factor in a credit score is the amount owed, which accounts for 20-30% of all consumers’ credit scores (E2%80%94%). However, the amount of debt you have isn’t the main determinant of this part of your score. Maintaining a solid credit utilization ratio can be key. However, exercise caution to avoid maxing out your cards as this will result in an excessively high ratio (more on that below).

How much credit do high-score consumers have — and how much do they use?

It’s also crucial to remember that people with excellent credit scores typically have high credit card limits in addition to their high balances. The average credit card limit for people with scores of 800 or higher is $69,346, This is higher than the average of $58,514 that we discovered in May 2021. According to generation, Gen Z has the lowest average credit limit ($54,003) and Gen X has the highest average credit limit ($72,255).

Your credit utilization ratio is the difference between the amount you owe and the credit that is available to you. The credit utilization ratio decreases with increasing credit and decreasing debt. Generally speaking, you want your credit utilization ratio to be less than or equal to 10%. Credit scores of 800 or higher are associated with an average utilization ratio of 6. 1%.

Factor Everyone Gen Zers Millennials Gen Xers Baby boomers Silent generation
Credit card limit $69,346 $54,003 $64,947 $72,255 $69,829 $63,111
Credit utilization ratio 6.1% 3.1% 5.4% 6.6% 6.3% 4.6%

Source: Analysis of anonymized credit reports of 100,000 LendingTree users

Compared to their peers, individuals with superior credit scores typically exhibit a significantly lower utilization ratio. For instance, among Gen Zers who have credit scores of at least 800, the utilization ratio is 3. 1%. That compares to 32. Five percent of Gen Z credit cardholders, based on our previous study For other generations:

  • Millennials with scores higher than 800 typically have a utilization ratio of 5. Four percent of all millennial cardholders have an average utilization ratio of twenty-four percent. 4%.
  • With scores of 800 or higher, Gen Xers have an average utilization ratio of 6. Six percent, and all Gen X cardholders have an average utilization ratio of twenty-one percent. 7%.
  • With scores of 800 or higher, baby boomers (ages 58 to 76) have an average utilization ratio of 6. While all baby boomer cardholders have an average utilization ratio of 2014, the percentage difference is 3%. 3%.
  • With 800-plus scores, the silent generation (those 77 years of age and older) has an average utilization ratio of 4. 6%. (In order to provide a general comparison, we excluded silent generations from our earlier study.) ).

Oldest active account is nearly 22 years on average

For those with scores higher than 800, the oldest active account is on average almost 22 years old. That represents a substantial decrease from 2021, when the average age of the oldest active account was over 27 years.

With an oldest account that is less than 15 years old, millennials are currently the generation with the youngest age of active accounts. Meanwhile, the silent generation has the highest at 28. 2 years. Baby boomers come next at 24. 8 years.

With an average age of nearly 18 years for their oldest active account, Gen Zers are positioned in the middle. Given that Gen Zers are only 25 years old, that may be difficult to understand, but it probably has to do with parents and guardians adding minors as authorized users on credit cards in order to help them establish credit. The majority of card issuers typically permit users to designate as authorized users minors who are at least 13 years old. However, this account’s oldest active status doesn’t accurately represent how long these Gen Zers have been allowed users. For example, if a Gen Zer was added as an authorized user to a 20-year-old card, that would be considered 20 years of history.

Everyone Gen Zers Millennials Gen Xers Baby boomers Silent generation
21.7 years 17.9 years 14.8 years 19.6 years 24.8 years 28.2 years

Source: Analysis of anonymized credit reports of 100,000 LendingTree users

Length of credit history accounts for a credit score for 2015, ranking it as the third most significant factor. Longer credit history typically helps raise your score because it provides lenders with a more accurate picture of your repayment habits.

High credit score consumers with younger accounts have less credit on average

Other credit factors are significantly impacted by having younger accounts. Notably, the average credit limit for customers with a credit score of 800 or higher and less than ten years of credit history is $50,798—lower than the credit limit for all customers.

Factor Credit history of less than 10 years
On-time payment rate 100%
Total debt $120,840
Monthly payments $1,261
Credit card limit $50,798
Credit utilization ratio 4.9%
Age of oldest active account 7.4 years
Number of open accounts 7.4
Credit inquiries in past 2 years 1.8

Source: Analysis of anonymized credit reports of 100,000 LendingTree users

Younger consumers also generally have short credit histories. With eight open accounts, the oldest active account for individuals under 30 is over 13 years old on average. Their limits are similarly smaller, at an average of $54,657.

The average age of the oldest active account and the total number of open accounts for individuals under 35 are comparable to those of their marginally younger peers. They can spend an average of $60,467 on their credit card, which is a marginally higher limit.

Factor 30 and younger 35 and younger
On-time payment rate 100% 100%
Total debt $110,089 $163,236
Monthly payments $980 $1,404
Credit card limit $54,657 $60,467
Credit utilization ratio 7.2% 5.3%
Age of oldest active account 13.4 years 13.4 years
Number of open accounts 8 8.2
Credit inquiries in past 2 years 1.8 2

Source: Analysis of anonymized credit reports of 100,000 LendingTree users

Consumers with 800+ credit scores have an average of 3 open accounts

High credit score consumers have an average of 8. 3 open accounts — similar to the 7. 9 we found in 2021. With an average of eight accounts, Gen Xers currently have the most active generation. 6 open accounts. Comparatively, there are the fewest active accounts (7 in the silent generation). 1. With an average of 7, Gen Zers trail them closely. 2 open accounts.

Credit mix accounts (including mortgages, personal loans, and credit cards) account for 2010% of consumers’ E2%80%99% credit scores. While credit age, amount owed, and payment history are more significant factors, having a diverse range of credit is helpful to lenders in determining whether you are making responsible use of your credit lines. For instance, using a loan rather than a credit card to make a big purchase may have a greater positive effect on your credit score.

High credit score consumers are limiting hard inquiries

In addition to making timely bill payments and managing their accounts, customers with excellent credit scores also minimize credit card inquiries. Americans who have at least an 800 credit score have seen an average of just 1. They have only made eight credit inquiries in the last two years, indicating that they are not frequently applying for new credit lines or loans.

Everyone Gen Zers Millennials Gen Xers Baby boomers Silent generation
1.8 1.9 2.1 1.9 1.6 1.4

Source: Analysis of anonymized credit reports of 100,000 LendingTree users

There are new credit accounts for the 2010 percent of your credit score, and new inquiries will stay on your credit report for two years. Even though it seems unimportant, Schulz says it still counts, especially if you want to get a great score.

According to him, “applying for credit too frequently and in excess is bad for your credit.” Every one of those inquiries carries a minor, transient stain on your credit, and an excessive number of them may cause lenders to become suspicious. It could give you the impression that you’re desperate, which is bad when you’re trying to borrow money. ”.

Full credit report profile of people with credit scores of 800 or higher

Factor Everyone Gen Zers Millennials Gen Xers Baby boomers Silent generation
On-time payment rate 100% 100% 100% 100% 100% 100%
Total debt $150,270 $51,693 $197,082 $193,051 $114,848 $66,593
Monthly payments $1,556 $506 $1,732 $1,985 $1,309 $715
Credit card limit $69,346 $54,003 $64,947 $72,255 $69,829 $63,111
Credit utilization ratio 6.1% 3.1% 5.4% 6.6% 6.3% 4.6%
Age of oldest active account 21.7 years 17.9 years 14.8 years 19.6 years 24.8 years 28.2 years
Number of open accounts 8.3 7.2 8.3 8.6 8.2 7.1
Credit inquiries in past 2 years 1.8 1.9 2.1 1.9 1.6 1.4

Source: Analysis of anonymized credit reports of 100,000 LendingTree users

Achieving an excellent credit score: What experts recommend

Earning an 800-plus credit score isn’t easy. Your credit history can take a long time to establish, and a few errors can temporarily lower your score. However, earning that excellent score isn’t impossible. To build your score quickly, Schulz recommends:

  • Verify that there are no errors on your credit report that could be preventing you from getting the credit you deserve. “Having good credit is hard enough,” he says. It occurs more frequently than you might think that someone’s errors or even fraudulent activity could lower your score. The last thing you want is for that to happen. ”.
  • Bump up your credit limit, and then don’t use it. “Your credit score is greatly impacted by your credit utilization,” he states. “While paying off debt is the best way to make it better, you can also alter the other side of the equation by having more credit available to you. You can achieve this by asking your present credit card issuers to raise the limits on your card, or by applying for a new card and using it sparingly. Issuers frequently agree to work with cardholders on these matters; however, you’ll need to inquire ”.
  • Mix up your credit. “Having multiple credit cards should not be the only aspect of your credit mix,” he advises. Installment loans, like mortgages, student loans, and auto loans, should be combined with revolving credit, like store and bank credit cards, to create the perfect credit mix. That being said, it’s crucial to understand that getting a new loan won’t improve your credit score. Debt is a very serious matter and ought to be incurred only when necessary. ”.

Researchers from LendingTree examined the anonymized credit reports of 100,000 users who had at least an 800 credit score in October 2022.

We defined generations as the following:

  • (Born after 1996; ages 18 to 25 in 2022) is known as Generation Z.
  • Millennial: (born 1981–1996), or 26–41 years old in 2022
  • Generation X (born 1965–1980; projected ages in 2022: 42–57)
  • Baby boomers (those born 1946–1964, estimated ages 58–76 in 2022)
  • Generation silent (born 1945 or before; by 2022, they will be 77 years old or older)

FAQ

How hard is it to get 800 credit score?

Just a little bit more than 2020% of consumers ever earn a score of 800 or above. Why? Compared to the vast majority of credit users, those with 800 credit scores use credit in different ways. Yes, they follow some of your similar actions: they never miss a payment, they make an effort to maintain a low credit utilization rate, and they check their credit report for mistakes.

How long does it take to go from a 700 to 800 credit score?

It may be possible to obtain an 800 credit score in a few years if you have a clean credit history and a low credit utilization ratio. On the other hand, it could take longer if you have a bad credit history or a high credit utilization ratio.

How long does it take to get 750 credit score?

If your credit score is currently at 700, it will take you several months to reach 750 through consistent good credit behavior. Examples of this behavior include making on-time bill payments, keeping your credit utilization rate low, avoiding applying for several new credit accounts at once, and keeping your older credit cards open even if you don’t use them frequently.

Read More :

https://www.lendingtree.com/debt-consolidation/what-it-takes-to-earn-an-excellent-credit-score/

How long does it take to get to 800+ credit score?
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