A credit score of 850 is perfect and one over 700 is good. Most of these have no delinquencies in their payment histories and a perfect payment history. On the higher tiers there are usually no public records on their reports. Late payments or even collections can drop off after seven years.
Creators of the FICO credit score, Fair Isaac Corporation, know well the habits of people with the highest FICO scores. It is actually rather easy for the average American to achieve high scores without much effort. Common sense is the one thing needed in most cases.
Paying all of your bills on time consistently is 35% of your total score.
Some may think that carrying no credit card balance at all is important to a good credit score but, this is not true. Using less of your available credit is good but no balance can actually hurt your credit score. Using 10% of ones total credit line is best. Paying off a credit card can bring your score down.
A habit that is synonymous with high credit scores is keeping credit lines open and having long standing accounts. About 15% of your credit score is the length you have had a credit history. The average age of all of them and age of the oldest and individual accounts. The average 800+ scorers have had account for 25 years and the average revolving was taking out 12 years ago. Opening a new credit account can actually make your score take a hit.
Opening new accounts can both lower your all round average and can hurt the length of your credit history. Ten percent of your score is for new credit and it includes occasions where you have applied for credit as well as accounts opened recently. This scoring formula only includes the last year and usually the higher FICO achievers have opened acounts 15 months or so on the average.
Higher achievers usually have several types of credit. This is good because it shows what lenders want to see. That the person is responsible in paying different types such as a loan, mortgage, credit cards and store credit lines. So having several different types of accounts can help with about 10% of your credit score.