How Long Does It Take To Build Credit? (2024)

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Having no credit history means you’ll likely have a hard time qualifying for a traditional loan or credit card without a co-signer. To expand your borrowing options, you’ll need to start building your own credit history.

Here’s how you can build good credit quickly, what credit scoring factors you should focus on and how to maintain a good credit score.

How Long Does It Take to Build Good Credit?

Based on FICO, the most popular credit scoring model, you can generate a credit score after six months of reported payment history. But the amount of time it will take you to build a good credit score—at least 670 based on the FICO scoring model—varies. Consumers who don’t have a long credit history can still have high FICO scores if they practice good credit habits, like making on-time payments and keeping the amount of money they borrow low.

That said, it will likely take you longer than six months to build a good score if you’re starting from scratch. To improve your chances of reaching this goal quicker, you’ll have to open a credit account, such as a credit card. Afterward, you’ll need to demonstrate good credit behavior to improve your score over time.

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What Credit Factors Should I Focus On?

When you’re establishing credit for the first time, you should keep these FICO score factors in mind:

  • Payment history (35%). Your payment history is one of the most important factors in calculating your FICO score. If you’re approved for credit, make on-time payments to add positive history to your credit file.
  • Amount owed (30%). The amount of money you borrow also has a huge impact on your credit score. If you’re approved for a credit card, don’t max it out. It’s recommended that you keep your credit utilization ratio—the amount of credit you use versus your available credit—below 30%.
  • Length of credit history (15%). This factor takes into account the average age of your accounts. Although having a lengthy credit score isn’t necessary for having a good score, it can have a positive effect on it.
  • New credit (10%). Don’t apply for too many credit accounts at once for the sake of building credit. New credit applications typically require a hard credit check, which can ding your credit score by up to five points.
  • Credit mix (10%). Having a variety of different types of credit accounts, like credit cards and different types of loans, can improve your score, but having each type isn’t required.

How To Start Building Credit

If you’re looking for ways to build your credit history, here are four steps you can take.

1. Open a Secured Credit Card

A secured credit card is designed to help consumers build credit. Unlike a traditional card, this type of credit card is easier to qualify for because it requires a security deposit. The amount of money you put down acts as collateral—something of value a provider can seize if you fail to meet repayment obligations—if you’re unable to pay your balance and helps establish your credit limit.

When searching for a secured credit card, make sure the issuer reports to the three major credit bureaus: Experian, Equifax and TransUnion. To add positive payment history to your credit file and avoid late fees and interest, pay your credit card bill in full on or before the due date.

Related: Best Secured Credit Cards 2024

2. Become an Authorized User

Another way to build credit with a credit card is to ask a family member or friend who has good credit to add you as an authorized user on their oldest credit card. If the issuer reports authorized user information to the credit reporting agencies, it could shorten how long it takes you to build credit.

3. Get a Credit-builder Loan

A credit-builder loan is a small, short-term installment loan that’s designed to help you build credit. It operates differently than a traditional loan. Instead of issuing you a lump sum of money to spend, a lender deposits the loan amount into a secured savings account until it’s repaid.

As you make payments on the loan, a lender usually reports this information to the credit bureaus, which helps you build credit. Once the loan’s term ends, the funds that were placed in the secured savings account are released to you, minus any fees.

4. Take Out a Loan With a Co-signer

If you need to take out a traditional loan instead, consider asking a family member or friend who has good credit and a stable income to co-sign for you. Before they agree to be a cosigner, explain to them that they’ll be responsible for repaying the loan if you’re unable to. To reduce your chances of defaulting and damaging your credit, only take out a loan you can afford to repay.

Fastest Way to Build Credit

Building a good credit score is generally a long-term game. For the most critical credit score factors like payment history and credit utilization, there aren’t many quick fixes besides diligently paying your debts on time every month.

Related: Best First Credit Cards

That said, you can do a few things that may help build your credit score in a few months instead of a few years. These may not be options for everyone, but they are worth looking into:

  • Pay down your lines of credit. If you have unpaid debt, pay it down as fast as you can. That will bring down your credit utilization ratio, which is a major factor when determining your credit score.
  • Request a credit limit increase. Increasing your credit limit can also lower your credit utilization ratio. The key is not to use your newly available credit, or else you’ll be in the same spot as before but with more debt this time around.
  • Set up autopay for all of your bills. Rather than boosting your score quickly, this tip is geared more toward preventing a quick downfall. If you pay late on any of your bills—even ones that aren’t normally on your credit report—it could damage your credit score. It only takes a few minutes to set up autopay on all of your bills to prevent this from happening.
  • Ask to be listed as an authorized user. If you have a trusted person in your life with better credit than you, ask if they’ll list you as an authorized user on one of their credit cards. Their entire credit history with that card would then be listed on your report, potentially boosting your score. The credit card company will issue you a credit card, but you don’t have to use it and can give it back to your friend or family member.
  • Dispute any errors on your credit reports. Creditors may report incorrect information to the main credit bureaus. Get a copy of each of your three credit reports and comb through them for errors. If you find any, dispute them with the credit bureau to correct them.

How to Keep a Good Credit Score

Once you reach your goal of having a good credit score, you will have to keep practicing good credit habits to maintain it. Here are three ways you can maintain or improve your score.

1. Monitor Your Credit Reports

Credit reporting errors, such as the wrong payment status and amount, can drop your credit score. To catch potential errors, review your credit report at least once a year. Due to Covid-19, you can request a free copy of your credit report weekly with each credit bureau by visiting AnnualCreditReport.com through April 20, 2022. After the, you’ll be able to view your credit report for free once per year.

If you catch an error, dispute it with each credit bureau that lists it on your reports or the creditor that reported it.

2. Pay Your Bills On Time

Payment history is the most important credit scoring factor. To maintain your score, continue paying all of your bills on time. If one of your bills becomes 30 days past due, a creditor can report it to the three major credit bureaus and it could cause major damage to your credit score.

3. Apply for New Credit Sparingly

When you apply for credit, a lender typically performs a hard credit check to assess your creditworthiness. Each credit check can cause your credit score to temporarily drop a few points. To prevent your score from dropping a lot, only apply for credit when you need it.

Bottom Line

Building credit for the first time generally takes at least six months, but building good credit can take even longer. While you work toward your goal of building a strong credit profile, practice responsible credit habits and be patient.

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Frequently Asked Questions (FAQs)

Does leasing a car build credit?

Leasing a car will build credit as long as your lender reports those payments to the three credit bureaus. It’s worth confirming with your lender in advance.

How often does your credit score update?

Your FICO score recalculates every time someone checks it. Whether or not it changes depends on if any creditors have added new information to your credit report.

Most lenders have a regular schedule when they report information to the credit bureaus, and that may not necessarily be when you make changes. For example, if you pay off a credit card, you might not see it reflected in your credit score until a month later.

What does your credit score start at?

FICO credit scores, the most popular score lenders use, range from 300 to 850. However, you don’t generally start out at 300. Once you have enough activity on your credit file, your credit score will generate within the score range depending on various credit factors.

What is the benefit of having a good credit score?

There are many benefits of a good credit score, but one of the biggest is simply being able to take advantage of opportunities for a better life. With a good credit score, you’ll have a better chance of being approved for affordable debt accounts such as mortgages, auto loans, credit cards and personal loans. Some landlords and jobs also may require you to have a good credit score.

How Long Does It Take To Build Credit? (2024)

FAQs

How Long Does It Take To Build Credit? ›

The Takeaway

How long does it take to build enough credit? ›

Building a great credit score can take much longer—as long as seven to 10 years in some cases. The reason a strong credit score often takes so long is because one of the factors taken into account is just how long you've consistently paid your bills on time.

How long does it take to go from 550 to 700 credit score? ›

The time it takes to raise your credit score from 500 to 700 can vary widely depending on your individual financial situation. On average, it may take anywhere from 12 to 24 months of responsible credit management, including timely payments and reducing debt, to see a significant improvement in your credit score.

How long does it take to get a perfect credit score? ›

Data shows that the average person with an 850 credit score has been at it for 30 years. The problem with aiming for an 850 credit score with only a few years of credit is that credit scoring agencies won't let you record an 850 credit score unless you have at least 10 years of perfect-payment credit history.

How to get a 900 credit score in 45 days? ›

Here are 10 ways to increase your credit score by 100 points - most often this can be done within 45 days.
  1. Check your credit report. ...
  2. Pay your bills on time. ...
  3. Pay off any collections. ...
  4. Get caught up on past-due bills. ...
  5. Keep balances low on your credit cards. ...
  6. Pay off debt rather than continually transferring it.

Is 2 years of credit history good? ›

Anything less than two years is considered a short credit history. Once you have established between two and four years of credit, lenders will better understand how well you manage your credit accounts. A credit age of five years will raise your score as long as you've been managing your accounts well.

Can you build a 700 credit score in 3 months? ›

It may take you 4 months to a year to reach the credit score of 700. Your credit score improvement is completely dependent on your financial activities.

Is 650 a good credit score? ›

As someone with a 650 credit score, you are firmly in the “fair” territory of credit. You can usually qualify for financial products like a mortgage or car loan, but you will likely pay higher interest rates than someone with a better credit score. The "good" credit range starts at 690.

How can I raise my credit score 100 points overnight? ›

How to Raise Your Credit Score 100 Points Overnight
  1. Become an Authorized User. This strategy can be especially effective if that individual has a credit account in good standing. ...
  2. Request Your Free Annual Credit Report and Dispute Errors. ...
  3. Pay All Bills on Time. ...
  4. Lower Your Credit Utilization Ratio.

Is 600 a bad credit score? ›

Your score falls within the range of scores, from 580 to 669, considered Fair. A 600 FICO® Score is below the average credit score. Some lenders see consumers with scores in the Fair range as having unfavorable credit, and may decline their credit applications.

Is a 900 credit score possible? ›

Highlights: While older models of credit scores used to go as high as 900, you can no longer achieve a 900 credit score. The highest score you can receive today is 850. Anything above 800 is considered an excellent credit score.

Has anyone gotten an 850 credit score? ›

Although a lot of people might like the idea of a perfect credit score, they'd likely have a hard time actually achieving it. In the U.S., only about 1.7 percent of the scorable population had a perfect 850 FICO credit score in April 2023, according to FICO data.

What is a realistically good credit score? ›

Although ranges vary depending on the credit scoring model, generally credit scores from 580 to 669 are considered fair; 670 to 739 are considered good; 740 to 799 are considered very good; and 800 and up are considered excellent.

How rare is a 900 credit score? ›

It's exceedingly rare for anyone to have a credit score over 900, as most credit scoring models have a maximum limit of 850, and even achieving that score is uncommon.

What is a good credit score to buy a house? ›

Some types of mortgages have specific minimum credit score requirements. A conventional loan requires a credit score of at least 620, but it's ideal to have a score of 740 or above, which could allow you to make a lower down payment, get a more attractive interest rate and save on private mortgage insurance.

Who has a 900 credit score? ›

It is not possible to get a score of 900. Older models of the FICO® and VantageScore® went up to 900, and there are other specialized scores that have different ranges going up to 900. The FICO Auto and Bankcard Score 9, for instance, ranges between 250 and 900.

Can you build a 700 credit score in 30 days? ›

It's unlikely you'll be able to get your credit score to where you want it in just 30 days, but there are some actions you can take that can improve your score more quickly than others: Pay off credit card debt. Your credit utilization rate changes as your credit card and other revolving credit account balances change.

How long does it take to get a 750 credit score? ›

If you are just beginning your credit journey, it may take a few years for you to get to 750. The only way to improve your credit score to any range is to continue following good credit habits.

How long does it take to build credit from 300 to 700? ›

It could take several years to build your credit from 300 to 700. The exact timing depends on which types of negative marks are dragging down your score and the steps you take to improve your credit going forward.

How to get a 720 credit score in 6 months? ›

To improve your credit score to 720 in six months, follow these steps:
  1. Review your credit report to dispute errors and identify areas for improvement.
  2. Make all payments on time and avoid applying for new credit.
  3. Lower your utilization ratio by paying down balances, increasing credit limits, or consolidating your debt.
Jan 18, 2024

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