If you’ve clawed your way back from bad-credit-score land, you might be determined to make it all the way to that magical zone between 800 and 850.
The good news is, you don’t need to crack 800 to get the best credit card offers and the lowest mortgage rates. Once your score climbs above 700, most lenders’ doors are open to you. And if your score is 720 or so, which is considered excellent credit, you’ll probably be able to get the best rates on just about any loan you apply for.
But a credit score of 800 may be in your sights anyway, just for the bragging rights. Here are five pointers to get you there faster.
1. Pay on time, every time
A significant portion of your credit score is riding on whether you pay your bills on time. And you really must pay everything on time, not just credit card bills. Utility companies and even your landlord may be reporting your payment history to the credit bureaus.
2. Lower your debt, then lower it again
Your debt-to-income ratio is an important measure of how well you’re handling your finances. Lowering your balances improves your ratio, and once you’ve proved yourself worthy you can ask your credit card companies to raise your credit limit, which improves your ratio even more.
3. Have a mix of account types
Applying for credit cards, especially several at once, can have a negative effect on your score. But showing that you can handle diverse kinds of debt is a good thing. Try to build your portfolio of loans. Some examples of different kinds of debt include credit cards, student loans, mortgages and personal loans. Stay away from toxic lenders like payday loan providers, and don’t let a desire to improve your credit score increase your overall indebtedness.
4. Wait it out
The average age of your accounts is an important factor. Keeping older accounts open is good for your credit history. You may also be waiting for mistakes to disappear. According to FICO, debts sent to a collection agency stay on your credit report for seven years, even if you’ve paid them off.
5. Clean up your report
You’re entitled to a free credit report every year from each of the three credit reporting bureaus — Experian, TransUnion and Equifax. All three can be obtained from AnnualCreditReport.com. If you see any errors, contact the bureau in question and also the company reporting to the bureau, requesting that the error be corrected and the black mark removed from your report.
The bottom line? Steady, on-time payments and diligently reducing your debt are the two most important things you can do for your credit score — and your peace of mind. If you do that, you’ll be in the 800 club before you know it.
This article was updated Aug. 25, 2016. It originally published Feb. 3, 2015.