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How to Raise Your Credit Score

Last Updated: June 6, 2024

7 min read

Table of contents

Key points about: increasing your credit score

If you have an error on your credit report, disputing it and having it corrected might improve your credit score quickly.
Paying off large balances might raise your credit score in a short time.
There's no guaranteed way to raise credit scores fast, but responsibly using credit can help you improve your score over time.

As a credit card holder, it’s important to stay on top of your credit score. If you recently checked your credit score and you’re unhappy with where it stands, there are ways you can improve it. Let’s review some tips for how to boost your credit score. Keep in mind: There’s no guaranteed way to raise credit scores fast because there are many factors to consider, but some factors can be corrected more quickly than others.

How to improve your credit score

If you want to raise your credit score, you should start by knowing where your credit stands.

At AnnualCreditReport.com, you’re entitled to a free credit report once a year from each of the three major credit bureaus–Experian, Equifax, and TransUnion.

Check your credit report for mistakes

When you get your credit report, check it for mistakes, such as a bill you paid that’s mislabelled as unpaid, or accounts you don’t recognize. These errors could reduce your credit score through no fault of your own. Reporting errors to a credit bureau is an important step and may help raise your credit score once resolved.

Removing errors from your credit report may be a fast way to boost your credit score since your score will be recalculated with the new information.

Improving your credit utilization ratio may boost your score

Your credit utilization ratio is the percentage of your available credit that you're using. For example, if you have a $2,000 credit limit and you spend $1,000 before your account cycles, that’s a credit utilization ratio of 50%.

Generally, it’s recommended that you keep your utilization ratio low. This indicates that you aren’t overspending and are doing a good job of managing your budget. If your credit utilization is currently high, paying it down may help improve your score.

Build your credit history

If you’ve never had a credit card before, you may want to consider one to begin building your credit history. This option may not be fast, but it may be faster than trying to build credit using another type of credit, such as a loan.

If you lack credit history, one option is to look into secured credit cards. Typically, credit card issuers offer secured credit cards that require no credit history to apply. Secured credit cards come with a credit limit equal to a refundable security deposit you use to apply. Paying the secured credit card's monthly balance in full and on time can help build credit history.

Did you know?

Some secured cards even offer rewards, such as the Discover it^® Secured Credit Card, where you earn 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases each quarter, automatically.¹

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Pay on time to increase your credit score

Your payment history can account for a large part of your credit score. You might positively impact that score by paying bills in full and on time, every time.

You may also be curious about what date a credit card issuer reports your activity to the credit bureaus. You can check with your credit card issuer for specific information on when they report your recent card activity. Discover cardmembers can find additional information under the Credit Reporting section of their statement. Log in to view your statement.

Mistakes to avoid when trying to raise your credit score

Along with mistakes on your credit report, these common factors could cause your credit score to decrease:

A payment on a credit card bill or loan that’s more than 30 days late could reduce points from your credit score. Payment history is a large component of a credit score, so any missed payments will likely hurt. If you’re trapped in a cycle of missed payments, consider seriously evaluating your spending and setting a tight budget until you get your credit card balance(s) under control.

Using a high percentage of your available credit might negatively impact your credit score. Your credit utilization ratio forms a significant piece of your credit score.

Applying for a new credit card or other types of new credit racks up hard inquiries, or instances when potential creditors look at your credit report. These can count against you since a consumer adding credit may be adding debt.

Retaining an old card may be more valuable than closing the account because closing a card likely lowers your available credit, which can raise your credit utilization ratio. If the card is one of your older accounts, canceling can also lower the average age of your credit accounts, which is also a factor in your score.

When a creditor cancels your card, it has the same effect as canceling a card yourself; your total available credit and length of credit history may change in a way that lowers your credit score. If your credit limit is lowered, that will impact your credit utilization as well.

While BNPL plans may seem like an easy way to build credit, it’s important to understand that each program is different and some do not report your purchase or payments to credit bureaus, which doesn’t help to raise your score.

Change bad habits to help build your credit score

Of course, it’s easy to simply say what some goals are to build your credit score, like a certain credit utilization percent or paying bills on time. In reality, it may be harder to reverse habits that might have led to bad credit in the first place. Once you’ve tackled the steps above, consider these next moves you may want to make.

First, you may want to structure your budget so you pay your bills just after you get paid when your bank account is flush. You can set reminders on your calendar for due dates, and many credit cards allow you to set up email alerts as well. If you’re paid on a set schedule, consider using an autopay option to pay your bill a day or two after your scheduled paycheck.

Finally, try not to spend more than you have. Make a budget that works for you, track your spending, and stick to it. Creating an emergency fund may be a good idea, and consider making savings goals for big purchases instead of just jumping on sales or desires. Purchasing a new TV can feel even better when you can afford to pay the bill in full. Unless you have a perfect credit score, there are usually ways to boost your score.

How long does improving your credit score take?

Most factors that raise your credit score take time, but some may be faster than others. For example, paying off a substantial balance could improve your credit score quickly. A credit limit increase could also improve your score quickly by reducing your credit usage compared to your available credit. If an error in your credit report is bringing your score down, repairing the error may also have a quick effect. While you won’t be able to boost your score overnight, you can begin steps today that could have a positive impact on your credit in the future.

Why does a good credit score matter?

Your credit score could have a substantial impact on your financial well-being and beyond. Lenders typically use your credit score to determine how risky approving you for a new credit account may be. A bad credit score may indicate that you don’t always make timely payments or that you carry a substantial balance. On the other hand, a good credit score is a sign that you’re able to manage debts and make timely payments. Therefore, your credit score usually plays a role in the approval process for not only a new credit card, but also a new personal loan, mortgage, or auto loan.

A potential landlord may also check your credit score before approving your application for an apartment, and your credit score could even influence your eligibility for some jobs. Because your credit score influences so many facets of your life, it’s almost always a good idea to boost your credit score however you can.

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