November 9, 2012
HIGH CREDIT SCORES:
FICO recently released findings from a study about the habits and behaviors of those who have the highest credit scores — 785 or greater. These high-credit scorers tend to qualify for the best mortgage rates, saving thousands of dollars over the life of a loan.
Nationwide, 25 percent — or 50 million people — are considered “high achievers” with their credit scores.
“High achievers” tend to exhibit some of the following behaviors, according to FICO:
- 96 percent have no missed payments on their credit report. For any who have a missed payment, it occurred, on average, about four years ago. (Payment history makes up 35 percent of a person’s credit score.)
- They tend to have a well-established credit history and rarely open up new accounts. On average, the oldest credit account was opened 25 years ago. Overall, according to FICO, these “high achievers” tend to have credit accounts that are at least 11 years old.
- They’re not always debt-free: They average about seven credit cards, including both open and closed accounts, and have an average of four credit cards or loans with balances. One-third of “high achievers” have balances of more than $8,500 on non-mortgage accounts. The remaining two-thirds have total balances of less than $8,500.
- About 1 in 100 have a collection listed on their credit report. What’s more, 1 in 9,000 has experienced tax liens or even a bankruptcy.