How long does it take to improve your credit score?

When you realise your score is on the lower end of the scale, you’re likely to have two immediate thoughts after you’ve asked the obvious question of ‘how to improve my credit score?’ The first is ‘how long is it going to take for me to grow my score’ and the second is ‘how hard will it be?’

At Noddle, we get asked these questions all the time. The response to both questions is that there is no definite answer – it varies from individual to individual. This is because it all depends on two important things:

  • Which of the below factors are affecting your credit score – certain factors – such as having a lack of information in your credit history- are going to take more time to fix than simply registering on the electoral roll.
  • How quickly we receive updates from lenders and other organisations – even if you register on the electoral roll today, it takes time for lenders and organisations to let us know about this change, so the updates to your file and thus your score can only happen as quickly as we receive the information.

Why does what’s affecting my score influence how quickly and easily I can improve it?

There are lots of things that can drag down your score and each has its own time implications for improving it.

Limited credit history: If you’ve not used much credit in the past or don’t have any active credit currently, you may have a lower score. Improving it is often as simple as taking out a credit builder card or loan, or even a mobile phone contract, to demonstrate you’re capable of borrowing money and making repayments. Of course, your credit score won’t improve overnight. In fact, you’ll likely have to demonstrate you can manage credit over a period of months before you start to see any improvement.

Not being on the electoral roll: If your score has taken a hit because you’re not currently on the electoral roll, it’s pretty easy to rectify the problem. All you have to do is register. You can do so here. However, as we explain below, how quickly you’ll see a change will depend on when we receive updated electoral roll information from your local authority.

Taking out too much credit at once: If you’re making lots of credit applications at once, it doesn’t look good. This is because it suggests to lenders that you’re relying heavily on credit to manage your finances. If the reason why your score has taken a hit is because of this, the bad news is that you need to be prepared to wait to see your score rise but the good news is that as long as you meet repayments and avoid taking out more credit, over time your score should creep back up.

Using too much of your available credit: At any one time, you shouldn’t be using any more than 25% of your total credit limit. For example, if your credit limit is £1,200, you should spend no more than £300. The amount of time it takes to improve your score if you’re using too much credit will largely depend on how quickly you can pay it off to the point where you’re sitting in the 25% bracket. It is, of course, not an exact science, but taking this approach is likely to help your score.

Having too much credit: Having too much available credit can negatively impact your score. To rectify this, it pays to close down accounts you no longer use but you need to be careful, as an old account that demonstrates a good credit history can help your score. The effect of closing down an account may take time to appear. A lot depends on when we receive updates from lenders and how much of an impact the account was really having on your score. Of course, sometimes putting an end to having too much credit relies on you paying off active credit arrangements, in which case it may depend on how long you have left on a credit agreement, such as store credit.

Debt and CCJs: Debt and CCJs will stay on your credit report for 6 years. The best thing to do is create a financial plan to help get yourself debt free and back in a good financial position. If you’re able to demonstrate good financial behaviour over time, this will be reflected in your credit score.

Being financially linked to another person: If you’re financially linked to someone – something that usually happens when you share a financial account – their financial behaviour will affect yours. If this link is something you want to get rid of because of divorce or separation – then you should contact each credit reference agency and ask for the link to be removed. Once this has happened, you’re likely to see a change next time your report is refreshed.

Updates from lenders and other organisations

As mentioned briefly above, how quickly you see changes in your score also depends on when we receive information from lenders and other organisations.

Each bank, building society, alternative lender, local authority and other relevant organisations has their own schedule for updating us and, coupled with the 30 day refresh period, you could be looking at around 90 days before you see any changes reflected on your credit report.

This time-frame is something you’ll need to apply to any of the strategies for improving your score when trying to work out how long it might take to see some growth.

Ultimately, improving your score is all about making smart choices and having the patience to see them through. Unfortunately, there’s no overnight fix but having a good credit score is worth the wait and the effort.

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