In this article:
Rebuilding your credit can take time, and there's no exact measure of how long you'll wait to see results. It depends on your unique credit profile and what specific events damaged your score. But that doesn't mean you're powerless: You can learn what helps and hurts your credit, and which actions you can take to begin rebuilding your credit score starting now.
What Factors Influence Your Credit Score?
Credit scoring factors are generally broken up into five categories, with several attributes per category.
- Payment history: Making on-time payments can help your credit, while missing payments can hurt it. The later your payments get, the more they can impact your credit. Other payment-related negative marks go into this category as well, such as whether you have a charged-off account or have filed for bankruptcy.
- Current debts: Your current debt amount relative to your initial loan amount can impact your credit. However, what's most important in this category is the amount of revolving credit you're using—your credit utilization ratio. Using a relatively small percentage (under 30%, but lower is better) of your credit cards' limits is better than carrying high balances that approach your credit limits. If you can, also pay your bill in full each month to avoid paying interest.
- The length of your credit history: A long history of managing credit accounts can help your credit scores. The ages of your oldest and newest accounts, and the average age of all your accounts, are all scoring factors.
- Experience with different types of accounts: Having revolving credit (such as credit card) and installment credit (such as auto, student or mortgage) accounts in your credit report could be better than only having one type of account.
- Recent credit applications: Applying for new credit accounts can have an effect on your credit.
Payment history and current debts—primarily your revolving utilization rate—are generally the biggest factors affecting credit scores. However, being knowledgeable about and mindful of all the factors can be important when you're rebuilding your credit.
Rebuilding Your Credit Takes Time
If your credit scores aren't where you want them to be, there are a few steps you can take to better understand what's impacting your score and rebuild your credit:
- Check your credit. Review your credit reports, and dispute information you believe to be inaccurate or the result of fraud. You can check your Experian credit report for free online and also get a FICO® Score☉ for free with a breakdown of what's hurting your score and how to improve it.
- Pay bills on time. Making bill payments on time is one of the most important things you can do to help your credit. Prioritize bills that get reported to the credit bureaus, such as loans and credit cards. You can also try using Experian Boost™† , which allows you to connect your bank account and get credit for making on-time payments that otherwise might not help your credit, such as phone, utility and streaming service payments.
- Pay down credit card debt. If high utilization is hurting your credit, one of the quickest ways to rebuild your credit is to pay down credit card debt. Even if you can't afford to pay off your cards, using a personal loan to consolidate credit cards can lower your utilization rate as you're moving revolving debt to an installment account. However, it may only be a good idea if you can also save money by lowering your interest rate.
- Use a credit-building account. Rebuilding your credit can be difficult if you aren't adding positive information to your credit history. Although you generally don't want to take out a loan solely to build credit, a secured credit card or credit-builder loan could be a good idea if you don't have any accounts that are being reported to the credit bureaus.
Slow and steady wins the race when it comes to rebuilding credit. Focus on what you can control—paying down debt and adding positive information to your credit. Over time, you may see your scores start to improve.
How Long Does Negative Information Stay on Your Credit Report?
Part of the reason it may not be easy to fix your credit quickly is that most accurately reported negative marks can stay on your credit report for seven to 10 years. Because credit scoring models such as FICO® and VantageScore® use your report to calculate your credit score, these long-term negative marks can have a lengthy effect on your scores.
- Late and missed payments: 7 years
- Collection accounts: 7 years
- Chapter 13 bankruptcy: 7 years
- Chapter 7 bankruptcy: 10 years
- Credit inquiries: 2 years
Although their impact diminishes over time, negative marks may affect your scores the entire time they're part of your credit history. Hard credit inquiries are an exception, as FICO® only considers hard inquiries for the first 12 months even though credit bureaus leave them on your credit reports for about two years.
How to Get Extra Help With Your Credit and Debt
Rebuilding your credit is going to be impossible if you have trouble affording your bills and find yourself missing debt payments regularly. Figuring out ways to cut expenses and save money can help. However, when you're deep in debt and interest keeps piling on, you may need a helping hand.
Nonprofit credit counseling agencies offer free and low-cost services like budget planning, and assistance with specific types of debt, such as student loans and mortgages. Many also offer debt management plans (DMPs), which could be a good option if you're having trouble with unsecured debts, including credit cards.
If a DMP makes sense, your counselor can negotiate with your creditors to try and get you lower monthly payments, decreased interest rates and waived fees. They may even be able to bring past-due accounts current so you can make on-time payments without having to pay off your entire outstanding balance. Once you're on a DMP, you'll make one monthly payment to the credit counseling agency, which will divvy up the money and pay your creditors.
Monitor Your Progress as You Work to Rebuild
As you work to rebuild your credit, you can watch your progress with free credit monitoring from Experian. You'll be able to see your score change over time, receive updated advice based on your latest report and get real-time alerts about suspicious changes in your report.