If you’ve put a lot of work into establishing good credit habits—you’ve been making sure to pay every bill on time and you’ve been paying down your credit card debt—you might be wondering just how long it’ll be before you see these actions reflected in your credit score. The time between when you exhibit positive credit behavior and when credit for that behavior shows up on your report depends on many factors.
While there are some basic timelines for certain items on your credit report, every consumer’s experience is different. What follows are some things to think about if you’re wondering how long it might take to see your actions impact your credit score, and how long certain items might remain on your report.
Understanding your credit behavior
“Establishing a timeline will be unique to each consumer and dependent on what shape their credit report is in,” says Jo Kerstetter, spokesperson for Money Management International.
The reason behind this individual variation lies with your lenders—the credit card companies, banks, and mortgage companies who report your data to the CRAs. Lenders track and share your payment history, including a record of whether your payments were made in full and on time, but there is no universal date for when they share this information with the CRAs. Additionally, while some lenders may report behavior to all of the CRAs, others will report to only one CRA or to none at all, which accounts for the variations seen between your three credit scores.
Tom Coates, director of Consumer Credit of Des Moines, agrees. “Nothing significant is going to help you overnight,” he says, but adds that positive behaviors may add up over time.
Regularly reviewing your credit report may help you gain a better understanding of your past and current behavior and how your payment history may already be impacting your score. You are entitled to one annual free copy of your credit report from each of the three major CRAs. To request a copy of your report, visit Annualcreditreport.com.
Healthy credit habits
Your credit score may change daily, weekly, or only a few times throughout the month depending on how often your lenders report data to the CRAs. The important thing is to make sure you have been consistent in meeting payments.
“The key is to pay your bills on time every month,” says Kerstetter. Your payment history accounts for around 35 percent of your credit and is the largest factor in determining your score. While there are many factors that determine your score, one of the most important things to consider is to pay your bills on time, everytime.
“Positive information usually stays on your record as long as the accounts are open and in good standing,” Kerstetter says.
The next biggest contributing factor to determining your score is the amount owed across each of your accounts. Amounts owed account for about 30 percent of your score, which means that paying down a debt or carrying a lower total balance on your various lines of credit may also impact your score.
Late payments or bankruptcy
Negative information, such as late payments or a bankruptcy, may impact your score just as often as positive items, but where positive behavior is unlikely to fall off of your credit history, negative credit behavior has the opportunity to disappear—but only after varying lengths of time:
- Hard inquiries. Hard inquiries typically fall off of your report after two years, but it may impact your score for even less time.
- Late payments or similar negative behaviors are likely to remain on your credit report for up to seven years. An account left in collections can stay on for even longer, usually seven years and 180 days from the start of the payment delinquency, and unpaid tax liens can remain on you report for up to fifteen years.
- Bankruptcy, generally remains on your credit history for up to 10 years however the exact amount of time will depend on the type of bankruptcy.
While it can be difficult to pinpoint exactly how long it may take for certain behaviors to impact your score, by establishing positive credit habits and maintaining them consistently, you may be in a better position to better understand your entire personal financial picture.
“Sometimes people get so lost on trying to get a better score, they don’t have their basic finances and their budget where they ought to,” Coates says.
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