"ow do I go from good to great credit?"

This is a common question from those who are in the 700+ credit score range and can't figure out how to improve it.

Here is an important concept: Credit Scoring looks for ways to measure your financial stress.

Available credit is a big factor. Imagine you have three credit cards, each with a $5k balance ($15k total) and a $10k credit limit ($30k total). You pay card #1 down to zero. Your credit score will go up because your open credit is greater - $10k balance vs $30k limit shows a lower financial stress at 33%. Then what happens when you close card #1? The ratio of open credit drops to $10k vs $20k going back to 50% stress, lowering your score. I recommend cautiously crossing in to 50% stress level and certainly never over 70%. I also recommend you close your accounts only if your stress level will be below 33% after closing, meaning get your card #2 and #3 balances down significantly before paying off and closing your card #1.

One of the worst things you can do to increase your financial stress is get a department store card that will save you an instant 10%. Most people immediately put 70% or more on that card the same day. Another mistake is applying for credit at an electronics store, say Bob's Big TV, and getting $3.5k worth of credit, then buying $5k of stuff. People will instinctively put $3.5k on their new card and $1.5k in cash. That $3.5k used vs the $3.5k limit jams your overall financial stress ratio to the danger zone almost immediately.

Other methods for going from good to great credit scores are to build equity faster than the credit report data anticipates. Let's say you have a car loan at $2k per month for a 'term' of 48 months. Scoring calculates anticipated balance against date of credit report pulled + monthly payment due + original balance reported vs. actual balance reported. Most of the time anticipated balance matches actual balance, so generally no score improvement for paying as agreed. Now, paying $2.5k per month lowers the real balance vs. the anticipated balance. That spread lowers your overall stress ratio, raising your score, similar to the above credit card example. As a side note: especially with car loans, specifically state the extra $500 is to pay principle. Otherwise they are most likely just going to reduce your next month's payment to $1.5k, getting you nowhere.

Lastly, I would recommend you plan your credit needs. Try to limit your attempts at new credit (often called a hard inquiry) to no more than 1 or 2 per year, if possible. It can cost you up to 8 points per inquiry. If you are making a major purchase, than have all your credit report inquiries done within 30 days. In some cases, inquires from the same industry category, such as mortgage, won't count against your score multiple times.