Paying bills on time and taking credit card balances down to zero are some of the things that can help improve a credit score, but how long does it take for all of this hard work to take effect?
The answer depends on when creditors have filed information to the three main credit bureaus. While most lenders and credit card companies update their records at least once a month, your credit score is not immediately updated. Instead, your credit score will be re-calculated at the time it is requested. So, once your credit report is updated the new data will be reflected in your score the next time someone asks for it to be calculated. Keep in mind, each credit monitoring service may update at different times.
There are some services which allow you to check your credit score more frequently than others, such as weekly versus monthly. The harder question to answer is how much effort it takes to really move the needle on your credit score. Here's some insight into how often credit scores change and why, so you can better gauge what you need to do to see a substantial improvement.
How often do credit bureaus update their reports?
Your credit report could change daily, or even more than once a day.
Creditors usually send information to the bureaus once a month, but they all report at different times, and it's not a given that they all provide information to all three bureaus. Also, some large credit card issuers handling millions of credit card accounts will send information to the bureaus in batches throughout the month.
How fast can you raise your credit score?
How fast you can raise your credit score will depend on:
What category on the VantageScore® or FICO® credit score range your credit score currently sits
If your score is very low, even a small sign of improvement in your payment history and reducing card balances might increase your credit relatively fast. But it will take more than paying your credit card bill on time for a month or two to really move your score into a range that's considered good enough to get unsecured credit cards:
- Developing a solid payment history
- Keeping your card balances at less than 30% of each card's credit limit
How long you've been trying to improve your credit score
Although time is of the essence to improve payment history, there are some very powerful moves you can make to see noticeable signs of improvement within weeks:
- Checking your credit report for errors and disputing them
- Paying down a balance on a credit card to zero
- Improving your utilization ratio by paying all balances down to less than 30% of credit limit
Whether you have recent missed payments or defaults on your report
Missed payments can stay on your credit report for seven years and bankruptcies for 10. You will more than likely need to re-establish a history of making payments on time, as well as reducing your principle debt every month, by paying more than the minimum payment due. Although missed payments stay on your report for seven years, their impact fades over time. All may not be lost if you've missed your payment by a few days. If the missed payment is an exception rather than the rule, then pay the bill as soon as you can and ask the lender if they could refrain from reporting the late payment to the bureaus this one time. There's no guarantee this will work, but it might–you could set up automatic payments in return, as a goodwill gesture. Just be sure that you catch that missed payment as soon as possible, because its impact on your credit score will get worse with every day it's in default.
How can I raise my credit score quickly?
There are ways you can boost your credit score rather quickly. Try the following, if you're negotiating for a mortgage, for instance, and want to push your credit score higher to qualify for a lower interest rate:
Pay down your balance:
Pay off a credit card balance entirely, or improve your utilization ratio by either taking advantage of an offer to increase your credit limit, or by reducing your balances to less than 30%.
Increase your credit limit:
Requesting a credit limit could lead to a more favorable credit utilization ratio, especially if your current balances are low.
Become an authorized user:
Becoming an authorized can result in more consistent, on-time payments being recorded on your report, which could increase your credit score.
Correct errors on your report:
Look over your credit reports to see if you spot any inaccuracies, such as an instance of a late or missed payment that could be hurting your score. The process for requesting a removal may vary, depending on the credit bureau, so be sure to contact them to learn more about this process.
Consider a rapid re-score:
Ask your lender to request a “rapid re-score" on your behalf from one or more of the credit bureaus. This will allow lenders to request the most updated and current version of your reports.
Keep in mind, that these methods will require responsible spending, paying off your account by each grace period and monitoring your account. Rapid re-scoring, for example, isn't something you can do to make things like missed payments and defaults disappear in an instant. It takes time to really get into the top categories of the possible credit score range. The good news is that sincere efforts to get back on the path to financial health, by paying bills on time and not maxing out credit cards, will help you build an excellent credit score.