How Long Does It Take to Raise Your Credit Score?
Struggling with a bad credit score? Here's how long it'll take to raise your credit score.
Contributing Writer at Tally
January 19, 2022
Your credit score can be tricky. Many variables can impact it, so it can be hard to predict its rise and fall. This makes finding ways to raise your credit score difficult.
Fortunately, there are ways to improve your credit score. But, most of them take time to start adding points. So, how long does it take to raise your credit score? We tackle that and other information about credit and your credit score to help you answer that question.
How long does it take to raise your credit score?
The answer depends on a wide range of variables, including the age of your last negative information on your credit report and others. However, the bare minimum it takes to increase your FICO credit score is generally 30 days, as this is the standard reporting schedule for most creditors.
In the real world, though, someone looking to make big improvements in their credit score can generally expect this to take six months to five years. But again, this depends on:
What negative information you have on your credit report
The accessibility of new credit to build your score with
The target score you're aiming for
Why is it so easy to ruin a credit score, though?
While building credit can take years, ruining your credit can take just a few months. Being more than 30 days late on a single credit card payment can send your credit score tumbling 90 to 110 points — not to mention the late fee and penalty APR.
The longer you're late, the more significant the impact on your credit history and credit score.
Credit is set up this way to help protect the interest of creditors. They want to know if you're in a tricky financial situation, and missing a credit card payment or racking up credit card debt is a key indicator of this. So, the credit bureaus are quick to drop your score, so creditors are aware and don't risk lending you money or issuing you a credit card.
What factors go into determining your FICO score?
Five variables help determine your FICO credit score:
Length of credit history
Each is weighted based on importance. Here's how much each impacts your credit score and what it takes to move the needle and improve this part of your credit score.
Your payment history is the most important factor in your credit score since it accounts for 35% of your score. Among other factors, It looks at how consistently you make at least the minimum monthly payment within 30 days of your due date. If your payment comes more than 30 days after the due date, your creditor may report a late payment. They'll continue reporting late payments every 30 days, and each 30-day increment can lower your credit score further.
Payment history looks at seven components in total, according to FICO:
Payment information to all creditors
How far overdue your missed payments are now or were in the past
How much you still owe on delinquent accounts, collection accounts, foreclosures and repossessions
The number of past-due accounts on your credit report
The amount of time that's elapsed since the accounts went delinquent
The number of accounts you are paying on time
After a late payment, improving your payment history can be challenging because you take two steps forward and one back. With every on-time payment you make, you're showing positive movement, but that late payment still lingers, pulling your score down a bit.
As that late payment ages, it becomes less impactful relative to current on-time payments. Eventually, the on-time payments become far more impactful than the older late payment, allowing your score to improve at a faster rate. But keep in mind that late payments stay on your credit for up to seven years and can continue making a negative impact the entire time, albeit less of an impact as it ages.
At 30%, amounts owed is the second most important variable. This variable looks at all the debt you have. Still, the most important part is your credit utilization ratio, the balance on your credit card accounts and other revolving debt relative to their credit limits.
Beyond credit utilization, the amounts owed factor looks at four other areas:
Amounts owed on all accounts, including installment loans
Amounts owed on different types of accounts — installment debt versus revolving debt
How many of your accounts have balances on them
The balance on your installment loans relative to their original loan amounts
Amounts owed is one area where it's relatively easy to move the credit score needle due to so much of your credit score hanging on your credit utilization ratio instead of total debt balances. If you have a high credit utilization rate — above 30% — and can get a debt consolidation loan to pay them all off, you could see a big credit score increase in just a few months.
As the credit card issuers report your balances as paid off, your utilization ratio will plummet, potentially sending your credit score upward quickly. However, this depends on what else is in your credit history. If you also have late payments and collections on your history, the positive impact may be significantly less.
Length of credit history
Length of credit history is the third most important factor in your FICO credit score at just 15%. The length of credit history looks at the average age of your credit accounts — the older your average account age, the more positively it impacts your credit score. However, if you have too many young accounts driving down the age, it can negatively impact your score.
This variable considers five specific items:
How long your credit accounts have been open
The age of your newest account
The average age of all your accounts
How long specific account types have been open
How long it's been since you used an account
Length of credit history is simply a waiting game, and there's no way to boost your score using this factor quickly. You can limit its negative impact by not opening new accounts or not closing old ones.
New credit is tied as the least important factor in your FICO credit score at just 10%. Its main focus points are how much new credit you’re attempting to open and how much new credit you’ve opened. It does this by looking at three factors:
The number of new accounts you've opened recently
The number of credit inquiries you've had in the past 12 months
How much time has passed since you've opened a new credit account
Like length of credit history, there's nothing you can actively do to improve this factor. However, you can mitigate its negative impact by limiting the number of hard credit inquiries on your credit report — which come from applying for credit cards or loans — and the number of new accounts you open.
Finally, credit mix ties new credit as the lowest factor in determining your credit score at just 10%. Credit mix looks at the number of revolving debts (credit cards, lines of credit, retail store cards) and installment debts (auto loans, mortgages, student loans) you have on your credit file. The more even your mix of different types of credit is, the more positive impact it has on your FICO credit score.
It may seem logical that you can move the needle on your credit score by simply getting new credit accounts to balance your credit mix, but that's flawed. The creditor or lender will do a hard inquiry on your credit to get a new credit account, harming the new credit variable. Then, the new account will harm the new credit and length of credit history variable. In all cases, you're coming out even or doing more harm than good.
Can you have multiple FICO credit scores?
Yes, you can have a wide range of FICO scores.
First, FICO itself has a range of scoring models for different industries, such as auto lending, credit cards and mortgages. Plus, FICO creates a score for each of the three major credit bureaus —Equifax, Experian and Transunion — and each credit reporting agency may have slightly different information, resulting in slight score variations.
Can you monitor your credit score and report for free?
Part of building a good credit score is monitoring your score and credit report. This not only shows you if you're on the right path but also allows you to spot inaccuracies that could potentially harm your credit score.
You can pay a monthly subscription to get access to your official FICO score through the major credit bureaus or MyFICO. However, if you're not up for a monthly subscription, you can also get free credit score estimates and free credit reports online at places like Credit Sesame or Credit Karma.
Remember, these are purely estimates and could be dramatically higher or lower than your official FICO score. However, these estimates will help you determine if your credit score increases or decreases.
Also, you're entitled to one free credit report per year by federal law from AnnualCreditReport.com. This won’t include a credit score — that comes at a cost — but you can review the report for any inaccuracies.
Remember, checking your credit has no impact on your credit score.
How long does it take to raise your credit score? It depends
Credit scores are intricate and have many moving parts impacting them. This makes it hard to know precisely how long it'll take to raise your credit score. You can control what negative reports hit your credit score from this point forward, but anything in the past just requires time.
If excessive credit card debt is hurting your credit score, the Tally† credit card debt repayment app can help. Tally helps you manage your credit card payments and offers a lower-interest personal line of credit, allowing you to pay off higher-interest credit cards efficiently. Because Tally manages all your credit card payments for you, you won’t worry about late payments anymore, possibly even helping you improve your credit history.
†To get the benefits of a Tally line of credit, you must qualify for and accept a Tally line of credit. The APR (which is the same as your interest rate) will be between 7.90% and 29.99% per year and will be based on your credit history. The APR will vary with the market based on the Prime Rate. Annual fees range from $0 to $300.