The company finds several commonalities among the people with the best credit scores.
People with the highest credit scores are those who have an average of seven credit cards, but only use four at any one time. This trait undoubtedly points to the age of accounts among people with high credit lines. Typically, new cards are opened and old cards are abandoned, never to be closed as they add to a person’s credit score.
Researchers find that although the top quartile has several credit cards, they refrain from holding irresponsible balances. Those in the top 25% carry an average balance equal to 7 percent of their total available credit. Missing a bill may just kick you out of the top quartile altogether, as only four percent of those who have the best credit had missed a monthly credit card payment.
A negative tidbit on your credit report will not completely eliminate your shot at being in the top 25% of credit users. In fact, FICO found collection agencies on one percent of all credit reports in the top 25% of scores. Also, some even had reports of bankruptcy or tax issues in their past, a sure negative that usually haunts borrowers for years.
FICO’s research reveals how little we know about credit scores but how much the average borrower can do to get the best score. As always, maintaining low balances and making payments on time are the most important part of responsible credit use – actions that will lead to good credit scores.
Source:
creditcardflyers.com
