7 Ways to Help Improve Your Credit Score
Steps you can take to help improve your credit
Doing the things you want to do. Seeing the places you want to see. Living life with a little less worry and a little more freedom. The flexibility that comes with a higher credit score can make some things in life a little easier.
And while improving your credit score may not happen overnight, these seven steps can help you start moving in the right direction.
1. Check Your Credit Score Often
First things first—you’ll likely want to know your current credit score. You can get it from the three major credit reporting agencies: Equifax®, Experian® and TransUnion®. The numbers they provide may be slightly different from one another, but all will give you a good idea of where you stand.
There are also free credit-monitoring tools like CreditWise® from Capital One® that help you keep a close eye on your credit. With CreditWise you can discover key factors that may impact your VantageScore 3.0 credit score, provided by TransUnion, get email alerts when something meaningful changes on your TransUnion credit report and more. And don’t worry—checking your credit report won’t hurt your credit score.*
2. Know Some Factors That Go Into a Typical Credit Score
What information goes into a credit score? Some of the factors that impact your credit score include:
- The percentage of available credit you’re currently using. This is sometimes called credit utilization. Keeping your credit utilization below about 30% can be a sign that you’re managing your credit responsibly and not overspending.
- Your bill-paying history. A history of late or missed payments could cause a dip in your credit score.
- How much outstanding debt you owe. That includes credit card debt, student loan debt, car loans and more.
- Your number of applications for new credit. When you apply for a new line of credit, it can trigger a hard inquiry, which can impact your credit score. Having too many hard inquiries on your credit report—especially in a short period of time—can significantly lower your score.
- Any instances of foreclosure, bankruptcy or debt that were sent to collections. How much will each of these factors affect your credit score? Short answer: It depends on how long ago it happened, how each credit reporting agency considers that information when it calculates your score and more. But remember, almost nothing affects your credit score forever.
3. Keep an Eye on Your Credit Report for Errors
If there are any errors on your credit report, they could be negatively affecting your score.
If you have a question about something on your credit report, contact the reporting agency right away.
4. Learn How Often You Can Check Your Credit Report
“How often can I check my credit report for free?” This might be one of the most common questions for people looking to improve their credit score—after all, it makes sense that you’d want to keep a close eye on it. Every 12 months, you’re entitled to one free credit report from each of the three major credit reporting agencies.
Or you can stagger your free credit report requests throughout the year. That way, you can get a free report about every four months. You can also pay for a copy of your report if you want to look at it more often.
Better yet, you can keep an eye on your credit as often as you want with CreditWise from Capital One. This handy tool gives you access to your credit score and your TransUnion credit report, both of which are updated weekly. And the best part: It’s completely free, and you don’t even need to be a Capital One customer to enroll.
5. Understand Which Credit Mistakes to Avoid
When it comes to improving your credit score, there are a few common credit card mistakes to avoid.
- Paying only the minimum amount due or maxing out credit cards can also keep your credit utilization high and could negatively affect your credit score.
- Having more available credit might give you more freedom, but applying for multiple cards—especially all at once—may affect your credit score. Apply wisely and only when you really need to.
- If a credit card is charged off due to lack of payment, it can cause a noticeable credit score dip. It usually takes about six months of missed payments for a credit card to get a charged-off status.
6. Make Payments on Time and Keep Credit Card Balances Low
The CFPB recommends trying to keep your credit card balance around or below 30% of your credit limit.
It’s also a good idea to pay your bills on time and pay your full balance when you can. Setting up reminders on your phone or computer can help you make payments on time.
7. Beware of Quick Credit Score Fixes
So How Long Does It Take to Repair Bad Credit, Anyway?
How long it takes to repair bad credit depends on your individual circumstances. Your current score, the factors that are affecting your score and more all go into how long it takes to repair bad credit.
If an error on your credit report is dragging your score down, you can dispute the error with the credit reporting agency. Unless the reporting agency considers your dispute frivolous, it has to investigate, usually within 30 days.
If bankruptcy or delinquent payments are the reason for a lower score, it might take a little longer to repair.
But most things won’t impact your score forever, and the effects of negative factors may lessen over time.
The moral of the story? Building better credit can lead to great things. In fact, you can start right now—learn more about monitoring your credit and then get to work improving your credit score.
*Your CreditWise score is calculated using the TransUnion® VantageScore® 3.0 model, which is one of many credit scoring models. It may not be the same model your lender uses, but it can be one accurate measure of your credit health. The availability of the CreditWise tool depends on our ability to obtain your credit history from TransUnion. Some monitoring and alerts may not be available to you if the information you enter at enrollment does not match the information in your credit file at (or you do not have a file at) one or more consumer reporting agencies.
We hope that you found this helpful. Our content is not intended to provide legal, investment, or financial advice or to indicate the Capital One product or service is available or right for you. For specific advice about your unique circumstances, consider talking with a qualified professional.