How Often Do Your Credit Score and Credit Report Update?

 

How Often Does Your Credit Score Update?

There are three major credit bureaus: Experian, Equifax, and TransUnion. When your lender reports your loan and credit activity, your credit report is updated with the new information.

But this isn't done in real-time. There's a process bureaus go through to make sure the data is valid. This can take anywhere from a few hours to several days. And if there's an error or something looks out of place, the bureau has to stop and verify the information before it goes into your file. This can delay your report from being updated quickly.

Lenders report information at least once per month, and when the data is added to your report, it's likely to produce a new credit score.

How Often Do Credit Card Issuers Report to the Credit Bureaus?

There isn't one answer to this question. Most lenders, especially credit card issuers, report once per month to the bureaus. The day they report your payment activity sometimes, but not always, coincides with the closing date on your credit card statement.

But keep in mind that other types of lenders might report to the bureaus less often. And even then, not all lenders report to all three credit bureaus. If you're unclear about this, ask your lender to clarify how often it reports your payment history and which bureaus it reports to.

Most credit card issuers report payment history to all three bureaus, and this is ideal for building credit.

What Makes Your Score Go Down?

Credit bureaus collect a variety of information about your credit accounts. Some examples include your reported balance, credit limit, and payment history. If you've had trouble using your credit card responsibly, then there may also be negative items that have been reported. These items create a change in your credit score but not in a good way.

At least there's good news about delinquencies and other negative items. There are time limits for how long they can stay on your credit report. After the time expires, they automatically drop off your report. That might be frustrating to hear, but there's more good news, too. After the first two years, the negative impact on your score starts to decrease.

Let's take a closer look at some of the most common things people can't wait to get off their credit reports:

• Late payments.
• High credit utilization.
• Bankruptcies.
• Other negative items, such as collection amounts.

Late Payments

These stay on your report for seven years starting from the date of your missed payment. Keep in mind that you don't usually get reported to the bureaus until you're more than 30 days late for your monthly payment. Do whatever it takes to set up reminders for when payments are due so this doesn't happen to you.

And don't forget to pay attention to all of your bills. If you default on a cellphone bill, for instance, it could possibly show up on your credit report if the creditor decided to report it.

High Credit Utilization

You have what's called a credit utilization ratio. This is the amount of credit you've used compared with the amount of credit you have available. If your ratio is greater than 30%, it could lower your credit score.

To boost your score the most, though, keep your ratio under 10%. This might sound difficult, but once you develop a solid credit history, you'll get fairly high credit limits, and this will be easy to pull off.