Just about all of us have a credit score. Your credit report and score are put together by current and previous lenders. They put together different pieces of data to settle on a particular score.
These lenders then send this information to the nationwide credit reporting agencies for your accounts.
Your credit report is a record of your credit history. It allows you and different corporations to see how you have handled credit in the past.
This allows lenders to assess your level of risk when applying for credit. If you have a poor credit history, this can create issues when trying to apply for credit cards, mortgages, or different loans.
This information can also help lenders decide which rates are best to offer.
The information includes the type of credit you have used and whether you have met monthly repayments on time every single month. This data also provides some public record information. For example, it can show if you have registered as bankrupt at all.
While most of us have a credit rating and credit history, it doesn’t stay the same from the moment you get it. Your credit rating can constantly change. Its records can reflect if and how you use credit throughout your life.
Let’s find out how often your credit score can change and how this happens.
When Do Credit Scores Update?
Credit reports are generally updated when a lender provides information to a nationwide credit reporting agency. This usually occurs once every month or at least every 45 days.
However, this can be more frequent depending on the lender.
This is why you may not see your credit report immediately after paying down a credit card. The best way to find out when your credit score was last updated is to check it online.
There is usually an option stating “Date Updated” so you can find out what your score was when it was most recently updated.
Not all lenders provide updates on the same day. This means new information may be added to your reports more frequently than 45 days or so. It is possible to get your credit report from any of the three nationwide credit reporting agencies every week via annualcreditreport.com.
Why Are Credit Scores Updated?
Every week, you can receive free reports. However, your credit score is not included in these. Knowing your report’s information can help you improve your credit score movements, however.
When information is received by different credit reporting agencies, it is usually added to your credit reports straight away. When information in your credit report changes, your credit scores may also change too.
The updated information determines how much these scores change and whether they go up or down. For instance, if you make a one-time payment, it probably will not cause your score to jump significantly, especially after a year of constant and continuous payments.
However, if you lower your balances across your credit cards by a significant amount, you could see your score change in a more positive direction.
By making consistent payments and keeping balances relatively low, you stand a better chance at keeping your credit on track. If you continue to follow this pattern, you should see your score improve over time.
Rapid Rescoring
If you are trying to get approval for a certain credit product, such as a mortgage, rapid rescoring could be advantageous. This can also be very useful if your credit score is close but not quite close enough for a lender’s requirement.
If you have made positive credit moves in recent times but your reports are not displaying these results yet, lenders can request this information to be added as soon as possible.
The result is that your report and score will be updated within just a few days. This is a much quicker turnaround as you would usually have to wait around for the next cycle when the credit scores and reports are changed.
There are some factors to consider when requesting a rapid rescore, however. These include:
- It is not possible to request a rapid rescore on your own.
- You can only receive a rapid rescore if a lender requests one on your behalf but this generally includes a fee for their services.
- If you have made previous mistakes that have negatively affected your credit score, a rapid rescore can not fix such an issue. It is unable to make any negative information disappear too.
Many people are trying to improve their credit health, especially when applying for loans or mortgages. If you are or have been trying to do this, it can be a frustrating process.
This is especially true if you have made some positive progress but it hasn’t been recognized by your credit report as of yet.
Sometimes, you may have to wait for a lender to provide the updated information to improve your health credit. But, you can still work on your credit score during this time.
Continue the momentum with extra healthy credit habits. The more you do to improve your credit score, the better chance you will have of securing a credit product such as a mortgage.
How To Improve Your Credit Score
Here are 10 simple steps to maintain a healthy credit score and see it continue to rise positively.
- Use a credit card regularly but responsibly
- Fix any mistakes on your report
- Maintain a low credit utilization
- Get yourself on the electoral roll
- Take advantage of eligibility checkers
- Do not make multiple credit applications within a short space of time
- Out your name on different bills if you are not already on any
- Be vigilant and keep an eye out for any fraud
- Pay all of your bills on time
- Have a good overall view and understanding of all of your finances
By following these tips, you stand a better chance of a positive credit score. Just one missed bill payment or a little mistake on your report can see your credit score become negatively impacted when the next update comes out.
