There is no single solution that will improve your credit score fast. Still, there are plenty of steps you can take to improve your score over time, including making on-time payments, monitoring your credit report for errors, and limiting your credit utilization. Below, we explain the factors that impact your credit score, plus the actions you can take to build or rebuild your credit.
How to Improve Your Credit Score
There are three major credit bureaus (Equifax, Experian, and TransUnion) and several different scoring models (such as FICO and VantageScore) that creditors use to determine whether you’re a creditworthy borrower. While each of these systems has its own specifications, they tend to follow the same general criteria in determining your credit score:
Each of these factors can negatively or positively impact your credit score, so it’s important to consider them all and find balance when managing your credit. For example, if you have an emergency need that increases your credit utilization, your score may decrease. However, you can counteract that by making on-time payments and avoiding opening any new accounts until you’ve paid down the debt.
Credit Repair Strategies
As noted above, keeping your credit score healthy is about balance — financial needs change constantly, so you’ll probably need to adapt your strategy over time. We explain how to improve your credit score below; use a combination of these tips for the greatest impact.
Keep in mind that there is no formula by which “If you do X, your score will increase by XX points.” The exact impact of any of the strategies detailed below will vary depending on the particulars of your credit profile. However, using these tips will help you build good repayment and credit use habits, leading your score to trend upward over time. Additionally, because some factors are weighted more heavily in determining your credit score, we’ve listed these strategies from highest to lowest impact.
Avoid Missed Payments and Defaults
Paying your bills on time each month is one of the easiest ways to keep your credit score strong. Since payment history makes up about 35% to 40% of your credit score, missed and late payments can have the largest negative or positive impact on your score. Creditors generally report payments once a month, so it’s important to make every payment on time, if possible.
If you have unavoidable payment issues, contact your creditor as soon as possible to see if you can work out an alternative payment option, such as a due date extension. To avoid defaults, you should also pay off any past-due amounts as soon as possible and keep in contact with your creditor. Note that records of accounts that have been sent to collections will stay on your credit report for seven years.
Use Less of Your Available Credit
Credit utilization measures how much of your total available credit limit you currently owe. Most experts recommend using less than 30% of your available credit, but this isn’t a rigid guideline — if possible, you should keep your utilization even lower. The lower your utilization, the more positive change you’ll see in your credit score.
For example, if you have two credit cards with limits totaling $10,000, you should be carrying a balance of less than $3,000 across both cards — that’s 30%. Individuals with balances of $2,000 (20%), $1,000 (10%), or less will see even greater credit score improvement.
If you currently carry a balance on any of your credit accounts — especially if you owe more than 30% of your available credit limit — you can improve your score by paying down your debt and then keeping your utilization as low as possible.
Another way to use less of your available credit without making spending cuts is to request a credit limit increase on your credit card(s). If your account has been in good standing for several months, you can request an increase in your credit limit, or you may be offered one automatically. Keep in mind that you should only request a credit limit increase if you are confident that you can continue to make on-time payments.
Keep Your Accounts Open
It might seem like a good idea to close an account as soon as you’ve paid it off, especially after resolving a large debt. However, closing an account means you lose both an element of your credit mix and that account’s age as a contributor to the length of your credit history. In most cases, it’s a better idea to keep the account open but use it as little as possible. This will keep your credit mix stable, maintain your average account age, and help decrease your credit utilization ratio.
Dispute Errors on Your Credit Report
Creditors might occasionally misreport information, such as marking a payment missed when it wasn’t. To avoid these errors, it’s a good idea to keep track of your credit report regularly. Our related research explains how to get a free copy of your credit report or credit score.
As you continue to check your score, watch for unexpected changes, drops, and mistakes. If you find an error, you may be able to contact your creditor to resolve the issue. You can also file a dispute with the bureau that shows the mistake in its report; you can submit your dispute online through Equifax, Experian, or TransUnion.
Be Careful When Opening New Credit Lines
You shouldn’t apply for new credit often, and it’s best not to apply for many credit lines at one time. Opening a new line of credit most often requires a hard credit pull when you apply, and hard credit inquiries stay on your credit report for two years.
Multiple hard inquiries around the same time can decrease your score by several points, and new accounts will lower your average credit account age. One hard inquiry will decrease your FICO score by less than five points, but those points add up as you apply for more accounts.
If you do need to open a new credit account, you may want to research your approval odds before applying. If you know you have less-than-perfect credit, consider loan or credit card options that are tailored toward borrowers with bad credit. Something like a secured credit card, which is designed for credit-building, might offer you a higher chance of approval.
Get a Credit Boost
Experian Boost is a free service from the credit bureau Experian that can help you keep track of and raise your FICO score. It offers access to your FICO Score 8 and your Experian credit file, updated every 30 days. It also includes dark web surveillance and credit monitoring.
Experian says this service can boost your score by about 13 points on average; it does so by allowing you to get credit for Netflix, phone, and utility payments (in addition to your regular credit payments) by connecting your bank account. Keep in mind, though, that this service will not have an effect on your Equifax or TransUnion files.
How Long Does Credit Repair Take?
There is no one answer to how long it will take to improve your credit score. Several factors influence the timetable, including:
- What has damaged your credit score
- How low your credit score is
- What credit level you want to reach
- Which actions you take to improve your score
For example, if your strategy is to decrease your credit utilization to 20%, someone starting at 35% utilization will likely see faster improvement in their score than someone starting at 65%. Likewise, if your goal is to achieve a “good” credit score, you’ll accomplish that faster if your current score is “fair” rather than “poor.”
Keep in mind that different types of negative marks remain on your report for different lengths of time — for example, delinquent accounts stay on your report longer than new account inquiries. Consider the following guidelines:
You can begin recovering your score while these activities appear on your report; just remember that you can’t erase negative marks from your record before the above-stated time passes.
A Warning About Credit Improvement Scams
It’s easy to become impatient while waiting for your credit to improve, especially if you have a specific and time-sensitive goal in mind (like qualifying for a home loan). There are credit improvement scams — advertised as easy ways to quickly fix your credit — that you should be aware of and avoid. The Federal Trade Commission (FTC) warns about scams that promise a new start to your credit history but actually sell Social Security numbers and encourage their clients to commit fraud unknowingly.
Keep the following tips in mind to avoid scams:
- Do your research. There are legitimate credit counseling companies; they will not ask you to pay upfront and will explain your legal rights thoroughly before you become a client. For trustworthy options, see the U.S. Department of Justice’s list of approved counseling agencies.
- Don’t pay upfront. If a company asks you for money before doing any work or provides vague promises about how it can help you, avoid it.
- Be patient and honest. Avoid companies that promise to remove accurate liens, bankruptcies, and other items from your credit file immediately. Don’t work with any company that asks you not to contact the credit bureaus directly or that asks you to dispute accurate information on your credit report. You should never give false or incorrect information on applications or dispute reports, even if advised by a credit repair company.
- Don’t accept suspicious numbers. Never accept a “CPN” (credit profile or credit privacy number) or apply for an Employer Identification Number with the IRS if advised by a credit repair company. If you engage in any illegal activity through a credit repair company, such as using someone else’s Social Security number or creating an illegitimate EIN, you can face legal consequences, including jail time.