The secret to raising your score to 900

Let’s get right to the point: here is what you might not know about raising your credit score to 900. Everyone always says that your credit utilization should be below 30%. This isn’t a strict cutoff but a general guideline.

So if you’re someone who prides themselves on having the highest credit score possible, you will need to use significantly less than that. The closer you get to 0% utilization rate, the better your score will be. And we all know that the better your credit score is, the better deals on interest rates or credit cards you can get.

0% utilization is not the goal though, having no utilization at all can hurt your score. A study by credit bureaus found that the average credit utilization ratio of customers with the highest credit rating was under 7%.

A credit utilization example

Keep in mind your credit utilization is measured in two different ways: your overall usage versus overall credit, and as a percentage of each card. If either one climbs to 30% or above, it will hurt your score.

If you have Credit Card A: $1000 limit and Credit Card B: $500 limit you shouldn’t use more than $450 (($1000 + $500) x 30% = $450) total credit and not more than $300 on Card A and $150 on Card B.

How your credit score is calculated

Your credit score is calculated using a FICO calculation, which will take into account some of the following, with various weights:

  • [35%] Payment History
  • [30%] Amount Owed
  • [15%] Length of History
  • [10%] New Credit
  • [10%] Types of Credit Used

According to Al Bingham, a credit expert: “Anything above 5% will start lowering FICO scores.”

Other ways to raise your credit score

  • Raise your credit limit - this will lower your score temporarily but will instantly reduce your credit utilization
  • Make all of your payments in full and on time
  • Diversify your loans from the bank - showing your are responsible with credit cards, an auto loan, line of credit, and mortgage will all help your credit score
  • Keep your old accounts open - this will make the average age of all of your accounts older, an element in your FICO calculation
  • Avoid asking for multiple new sources of credit in a short time frame - this can make you look desperate and like a risky investment for the banks