Credit is so important, but few people really understand how it works. A good or better credit score can save you hundreds of thousands of dollars over the average person’s lifetime, give you access to cash to buy a home, get an auto loan for a car, finance a business, and get out of debt faster and cheaper. Studies even find that a low credit score reduces your romantic prospects. Facts.
Thankfully, I have always had a high credit score and a clean credit report. This has allowed me the following benefits:
- Bought my ex out of our apartment when we divorced — at a very competitive interest rate
- Bought a new car when my old one died
- Earned a $0 credit card to float some business expenses when I was starting my media company
- Snagged some successful boyfriends who cared that I had my financial act together
There are all kinds of reasons your credit score may be low — or even average, though of
Two tools to quickly improve your credit score now:
- Secured credit cards. A secured credit card requires you to put down a cash deposit to secure your own credit line — and as long as you make regular charges, and regular payments on time, your score will increase quickly. Find a 0% secured credit card now >>
- Check your credit report and FICO score for free, and see if you qualify for an immediate credit score increase of up to 13 points with Experian Boost >>
- Use a credit repair service. Try The Credit People to clean up your credit report, for $9 to get started >>
So, let’s look at this topic from all angles:
- What is credit?
- Why is having bad credit a big deal?
- How to get a loan with bad credit—and why you can’t afford it
- How to build credit fast
- How to get a credit report
- Credit scores — what they mean and why they matter
- How to get a credit card with bad credit or no credit score
What is credit?
But … what exactly is credit? Credit is simply your ability to borrow money. This could be from a bank, credit card company, student loan financer, car loan underwriter — or even a friend or family member. The terms of the credit are affected by the likelihood of your ability to repay any loan or debt. These include:
- Your history of paying bills on time
- Credit: debt ratio, or the amount of debt relative to the amount of credit you have — 30% or less is ideal. In other words, if a credit card gives you a $10,000 limit, try to keep your credit balance at $3,000 or lower.
- Length of credit history. Many people, especially younger adults, have a low credit score simply because they do not have a recent history of borrowing and repaying money.
- Type of credit. A mix of installment (like a car or home loan) and revolving credit (like a credit card) is ideal, though type of credit accounts for just 10% of your credit score).
- Number of credit inquiries. An inquiry includes when you apply for a loan or credit card, and any interested lender sends a message to the credit bureaus inquiring about your credit history.
What is considered to be good credit?
Credit scores range between 300 and 850.
The higher the score, the more likely a lender will give you a loan, at a low interest rate, because you have proven to be likely to pay back the loan according to the terms.
A credit score of 700 or higher is considered “good.”
A score of 800 or higher is considered “excellent.”
Most credit scores fall between 600 and 750.
Why is having bad credit a big deal?
FICO is the most widely used credit score, and it ranges from 300 to 850.
Generally, a score below 550 is bad news, and anything above 750 is golden.
If you’re in the middle, you’ve got some leeway, but the higher the better.
Crummy credit can keep you from getting the things you need to get ahead — or even just caught up — in life.
In some cases, employers run credit checks on potential hires.
If you need to get a mortgage to buy a home (or refinance your mortgage to keep your house), get a car loan, get a student loan, a good rate on insurance, or a line of business credit, you may find that you need a boost in your credit score to get what you need.
The higher your score, the better the chance of reaching your goal, and the lower the interest rate, which means the less you will have to pay back on the debt.
Can you imagine nailing an interview at your dream job only to lose out in the end because your credit isn’t good enough?
In extreme cases, it can affect where you lie your head at night. Many landlords run credit checks.
There are people in nearly every town in America paying hundreds of dollars a week to live in hotel rooms because their credit isn’t good enough to get even the most basic apartment.
That’s terrible, and it’s a destructive cycle because when you’re paying that much just to have a bed, it’s even harder to climb out of a hole and start repairing your financial situation.
What is considered to be bad credit?
A “low” credit score is any score below 620.
Poor Credit is 600-649.
Bad Credit is below 600.
Poor credit can be owed to:
- No recent history of using credit
- Late bill payments
- Maxing out credit limits
How to get a loan with bad credit—and why you can’t afford it
While having a great credit score can make your life a whole lot easier, the opposite is also true. A bad credit score can make your life harder and more expensive. That’s because bad credit makes it more difficult to qualify for a loan for a car or mortgage, or even qualify to rent an apartment. If you do qualify with bad credit — you’ll typically pay a much higher interest rate and more fees.
But what is a bad credit score? According to myFICO.com, poor credit is typically considered any FICO score of 579 or below. However, you may also struggle to live the life you want with “fair credit,” or any FICO score between 580 and 669.
Bad credit loans and why you need credit repair
Why you should care about your credit score — especially if you’ve made some pretty bad credit mistakes in the past? Well, let me tell you, bad credit can affect your life in more ways than one. Here are some examples:
Loans for people with bad credit tend to come with insanely high interest rates that make paying them off expensive and difficult. This is especially true for bad credit loans with guaranteed approval — if a lender agrees to approve you no matter your credit history, there’s a good chance you’re going to pay very high rates.
If you plan to apply for a personal loan with bad credit, here’s what you have to look forward to: Bad credit loans from Prosper come with ongoing interest rates as high as 35.99% APR. On top of that, you’ll pay an origination fee of up to 5% of your loan amount!
Car loans with bad credit are just as bad. Bad credit at car dealerships tend to offer a very small selection of cars you can get access to with a “buy here, pay here” scheme. This means they offer in-house auto financing, which is convenient but expensive. Auto loan interest rates can be exorbitant at these dealerships since they’re taking a huge risk that you won’t repay your loan. Before you go car shopping, check auto loan rates online with LendingTree.
Home loans for bad credit exist, but they tend to make you jump through more hoops to qualify. You can get an FHA home loan with a credit score as low as 500, for example, but only if you put 10% of the purchase price down. If your credit score is at least 580, on the other hand, you can get an FHA loan with only 3.5% down.
While FHA loans aren’t really considered bad credit mortgages, they do require you to jump through some extra hoops. You must pay upfront mortgage insurance upfront and for the life of the loan, for example.
Renting with bad credit is also not for the faint of heart. Potential landlords will want to check your credit report before they approve you as a renter, and they may deny you outright if your credit is bad — or require you to get a co-signer for your loan. Apartments or houses for rent with bad credit are also not as readily available as units for people whose credit is better.
Startup business loans with bad credit also exist, but their terms aren’t very attractive. If you’re wondering how to get a business loan with bad credit, the answer is simple — plan to pay exorbitant interest rates and fees.
Emergency loans for bad credit are also sketchy — and that’s especially true when it comes to bad credit payday loans. Without exception, you should stay away from payday loans since they can charge interest rates as high as 400% and leave you stuck in a payday loan cycle that can be hard to break.
How to build credit fast
There are many reasons why you may need to build your credit fast: You want to buy a home or car, need to rent an apartment, qualify for a loan for school, business or a home renovation. Thankfully, building credit, or fixing a bad credit score, is easy — but it takes time, patience and diligence.
One of the most common questions is “How long does it take to build credit?”
If you do not have any recent credit history, you can build a good credit history with the credit rating company FICO, within six months. The newer competitor VantageScore will generate a credit score within a few months.
Here are 5 ways to build a credit score from scratch:
To open a secured credit card account, make a deposit via bank transfer, or at a retail bank.
Set up a recurring, small bill to the card, such as a cell phone bill, or gym membership.
Then, set up automatic payments in full on the secured credit card, so that your monthly balance is always paid in full.
Keep an eye on your credit score, which should climb steadily.
If you miss a bill, the balance will accrue interest—which is typically higher than other forms of credit. Eventually, the balance plus interest, will be taken out of your deposit.
If you always pay your bill on time, you will eventually get your balance back.
Before you sign for a secured card, make sure:
*It has a low annual fee
*It reports to the three credit bureaus: Equifax, Experian and TransUnion.
Resource: Where to find the best 0% secured credit cards
Once your score reaches 700 or more, move on to a regular, unsecured credit card — one with no annual fee, a good points system, and other perks that you can now enjoy thanks to a solid credit score!
2. Get a co-signer with good credit for a regular credit card. If your parents, partner or friend has a long and happy credit history, ask if they will co-sign for a credit card. Their good credit will affect your credit.
3. Become an authorized user on the credit card of someone with good credit.
4. Be a good credit user:
The best way to boost your credit score now, and in the long-term is to be a good steward of your credit:
- Pay your bills on time, and in full.
- Keep the total borrowed at 30% or less of the credit limit.
- Keep an eye on your credit score and report, and address any errors on your credit report.
- Don’t close accounts. Even if you pay off your credit card, keep the account open. A long credit history is a positive.
- Keep number of credit accounts to a minimum.
How to fix bad credit
Your credit score may be low for all kinds of reasons — some may not even be your fault. The good news is that credit is never ruined forever. Here is how to fix your bad credit, and repair a low credit score:
1. Review your credit history at Equifax, Experian or TransUnion.
2. Dispute any errors, late payments, lines of credit that are not yours, duplicate accounts, and accounts that should have aged off the report. You may choose to hire a credit repair company to do this for you.
3. Increase your credit limits. One of the most important factors of your credit score is credit utilization — or the percentage of credit that is available to you that you actually use. In other words: Don’t max out your credit cards. Since your credit utilization is calculated across all your lines of credit, by increasing the difference between your credit balance, and the credit limit, you will quickly improve your score. You can improve your credit utilization by:
- Call your credit card company and ask for your limit be increased
- Pay down any debt
- Open a new card. Even if you don’t use the new card, that new limit improves your credit utilization score — and therefore your score
5. Ask for a co-signer with a good credit history — or ask that friend or loved one to make you an authorized user on their card.
6. Keep paying those bills on time! (but you knew that)
How to build business credit fast
If you have your own business, you may need a business credit card, business loan, or to sign a
While one may influence the other, your business and personal credit scores are considered separately.
- Incorporate and establish your business. I incorporated into an S Corp through LegalZoom. That will provide you with an EIN.
- Establish your business with its own P.O. box or other mailing address, phone number, business checking account, and register with Dun and Bradstreet to get your DUNS number.
- Check your business credit reports for errors. Scan the report for the correct address, ownership information, debts, liens, bankruptcies, and sales figures.
- Establish trade lines. These are lines of credit with your vendors. Pay on time, and make sure these lines are reported to the credit bureaus.
- Pay on time. Every time. Even early!
- Build your personal credit history and score.
How to get a credit report
Thankfully, there are federal laws that protect consumers, and ensure you have access to your credit report, credit score, and all information potential lenders can see about your borrowing history. Legally, you also have the right to dispute all errors on your report. In other words: when it comes to credit, the law is on your side.
To start to understand your own credit history and score, start by pulling a free credit history, which will also have a credit score. I go into detail about what a credit score is and how the report works below.
The three major credit reporting agencies, Experian, TransUnion, and Equifax, all provide credit scores and reports, but in slightly different ways:
Equifax offers several credit protection and monitoring programs. For a fee of $14.88 per month, you can get both your FICO and VantageScore credit scores and credit reports.
Experian uses the FICO 8 credit score system. For a fee starting at $24.99 per month, you can get the Credit Tracker subscription, which allows you to monitor your credit score, and get your credit report. Increase your FICO® Score* instantly up to 13 points, and get a FREE FICO SCORE with Experian Boost (free) >>
TransUnion will also provide your credit score and report for a monthly fee, but also provides its free TrueIdentity credit lock program, which lets you monitor your credit activity and lock your account.
How to get a free credit report
Today, most banks, credit unions and even credit cards provide a free credit score for free, automatically. You can also get a free credit report, with all the details of your credit history, once per 12 months, for 100% free, from annualcreditreport.com, which is authorized by federal law. People often ask if it is safe to use annualcreditreport.com, since you must share your social security number and other important identifying information. The answer is: Yes, it is safe to use this service, which is tightly monitored by the three reporting bureaus that support the site with their credit scores and reports.
How to read a credit report
Now that you have your credit report, what does it all mean?
A credit report typically has six parts:
1. Personal history. Check to make sure your name, social security number, birth date, address and other information
2. Employment history. This helps confirm your identity. Make sure that it is accurate and up-to-date.
3. Consumer statements. This is a record of when you have challenged or disputed charges and other credit information in the past.
4. Account information. This is where the juice is. Check and double-check to make sure this information is correct, rightfully attributed to you (and not someone with the same name), and up-to-date. Account information includes:
- Open accounts
- Closed accounts
- Dates accounts were opened or closed
- Payment history
- Credit utilization
- Current account balance
- Loan payment status
5. Public records include bankruptcies, foreclosures, tax liens and civil judgments.
6. Hard inquiries, or requests by a bank or another financial institution about your credit history. If you see credit inquiries that you believe were not intended for you, dispute this.
How to freeze your credit report
If you are a victim of identity theft, if your mail or financial passwords have been compromise, or perhaps you are going through a breakup with someone who you think may take advantage of having this information, consider freezing your credit report.
When you freeze a credit report, creditors — or hackers — can’t access your credit score or report unless you give them a PIN. However, current lenders can. It is now free to freeze your credit, and lift a freeze. You have to contact each of the three reporting agencies individually:
- Equifax: 800-685-1111 or go online.
- Experian: 888‑397‑3742 or go online.
- TransUnion: 888-909-8872 or go online.
Credit scores — what they mean and why they matter
No matter what you’ve read about household credit card debt and American money woes, remember that most people struggling with debt didn’t land there by choice. Sometimes all it takes is a few massive medical bills, a pricey divorce, or a cut in pay to send your finances into a tailspin. When that happens, it’s easy to turn to credit to bridge the gap — at least until your credit card bills take on a life of their own.
- Why your credit score matters
- What is a credit score?
- How to check your credit score
- 5 tips to raise your credit score in a hurry
- How to get a credit card with bad credit or no credit score
The reality is, having a credit card for emergencies is actually a good idea. You never know what kind of surprises life will throw your way, whether it’s a leaking roof that needs to be replaced, an emergency surgery, or a tax bill you weren’t prepared to pay.
But, what happens when you don’t have the money to pay your credit card off at the end of the month? In short, your debt can go from manageable to scary really fast — much faster than you think. And on top of accumulating debt, you’ll typically have to pay interest — up to 24.99% APR or more on some cards. Heck, even the average credit card APR is well over 17% right now — and that’s the average.
And the pain doesn’t stop there. If you’re only able to make minimum payments, it can take years and years to pay off your debt — and you wind up paying more the longer it takes. If you happen to miss a payment or make a payment past your due date, you’ll take a massive hit to your credit score and rack up a late payment fee.
Why your credit score matters
I’m not saying credit is all doom and gloom — not at all. I’m simply sharing the many pitfalls you’ll need to avoid if you choose to use credit cards. There are actually quite a few ways you can “win” the credit game without getting into debt or ruining your credit score, too, so don’t be discouraged.
Believe me, your credit score matters more than you think. If you’ve ever tried to take out a mortgage, borrow money for a car, or rent an apartment, then you already know.
Like it or not, lenders, landlords, and businesses use your credit score and the information on your credit report to determine whether to work with you. If you have “poor” credit or even “fair” credit, you may not qualify for the home loan, a car loan, or apartment you want. If you ruin your credit and don’t take steps to improve it, you could be renting a crappy apartment or living in your parent’s basement until the end of time. Who wants that?
This guide goes over what a credit score is, how to check it for free, and how to raise your credit score quickly. We’ll also go over how credit cards work, how to get one, and how to use a credit card to build credit over time.
Some of the topics we’ll cover are boring, but they’re important to understand if you don’t want your life choices severely limited by poor credit. Keep reading and we promise you’ll learn something you didn’t know before.
What is a credit score?
Lenders use a few different types of credit scores to measure your creditworthiness, including VantageScore credit scores and the FICO score model. The reality, however, is that 90% of top lenders rely on the FICO score over other types of scores.
What is a FICO score exactly? Your FICO score is a three-digit number between 300 and 850 that represents your credit health. The higher your credit score is, the better off you are.
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Generally speaking, FICO breaks down their scores into the following categories:
- Exceptional credit is any score over 800. Scores in this range are higher than the national average, and consumers with excellent credit are very likely to be approved for loans and other types of credit.
- Very good credit is any score between 740 and 799. Consumers with scores in this range are very likely to get approved for the loans they want with competitive interest rates.
- Good credit is any score between 670 and 739. Borrowers in this range are typically considered “acceptable,” and they may or not may get approval for loans with the best rates and terms.
- Fair credit includes scores between 580 and 669. If your credit score falls in this range, you may be denied for credit cards and loans. If you do get approved, you will likely pay higher fees and a higher interest rate.
- Poor credit is any FICO score that is 579 or lower. People in this range are usually denied when they apply for unsecured credit cards or loans.
The details above probably have you wondering something — what is the average credit score anyway? According to credit reporting agency Experian, the average credit score was 704 last year. This means most Americans have “good credit,” although there are plenty of folks who fall on both extreme ends of the spectrum.
Another important thing to remember — there are three main credit reporting agencies that dole out credit scores. Credit bureaus include Experian, Equifax, and TransUnion, and each one of them may assign you a different credit score than the next. This means you have three FICO credit scores from the three credit reporting agencies, even using the same credit scoring method.
How to check your credit score
If your goal is improving your credit, it’s crucial to find out “where you’re at.” This means running a credit score check through a credit score estimator or signing up for a service that lets you get your credit score free.
Do you need a free Equifax credit score? A free TransUnion credit score? A free Experian credit score? Probably not all three. The point is getting some sort of estimate of your credit score so you know where you stand and if you need to take steps to improve.
Ready to face your credit score? Here’s what we suggest:
- Sign up with Credit Sesame for a free estimate of your credit score. These free services will provide you with updates on your credit score in real time, making it easy to monitor your progress.
- Check your credit report online for free with AnnualCreditReport.com. This government-approved website lets you get a copy of your credit report from all three credit bureaus — Experian, Equifax, and TransUnion — once per year.
- Check whether any of your credit cards offer a free credit score on your monthly statement. Many popular cards and card issuers do, including Discover credit cards. Capital One credit cards also come with CreditWise — a free service that lets you track your credit in real time for free.
5 tips to raise your credit score in a hurry
You may be wondering how to raise your score by 200 points over time or how to get your credit score up fast. Either way, the steps to improve your credit score are the same:
Credit score tip 1: Make all your monthly payments on time — all of them!
The most important factor that makes up your FICO score is your payment history. As a result, you need to make it a priority to make all your monthly bills on time. This include credit cards, utility bills, your car loan, and any other bills you have.
Credit score tip 2: Pay down high-interest consumer debt.
The second most important factor that makes up your credit score is how much money you owe in relation to your credit limits. Experian notes that high credit utilization tips lenders off that you could be a high-risk borrower. Keep your credit utilization below 30% at all times, and you should see your score rise over the long haul.
Credit score tip 3: Don’t open too many new accounts.
While it can be tempting to open new credit cards accounts to earn airline miles or cash back, try not to open too many. Each new card places a hard inquiry on your credit report, and each hard inquiry can hurt your score. Opening a lot of new accounts can also reduce the average length of your credit history, which can also negatively impact your credit health.
Credit score tip 4: Keep old credit accounts open — even if you’re not using them.
Also make sure you’re not closing older credit cards that aren’t in use. Each card you keep open can make your credit history seem longer, and this can help increase your score over time.
Credit score tip 5: Dispute inconsistencies and errors on your credit report.
When you get a free copy of your reports from AnnualCreditReport.com, make sure to scan them to check for incorrect information that could be hurting your score. If you find errors or downright lies, make sure to dispute them via the formal process offered by the Federal Trade Commission (FTC).
You may choose to hire a credit repair company to do this for you.
How do credit cards work?
We already mentioned how credit cards can be a valuable tool in a pinch, but you really do need to know how they work before you dive in.
- How to get a credit card
- What is a balance transfer credit card?
- How to get a credit card with bad credit or no credit score
- How to use credit cards to build credit and improve your credit score
- How long does it take to improve a credit score?
Having an understanding of how interest is charged can help you avoid racking up big balances that will devour your extra income. Plus, you need to know how to use a credit card in your favor — in a way that will help you instead of ruining your life.
First, it’s important to understand that credit cards offer a line of credit you can borrow against. Also, be aware that credit cards have limits! Your credit limit will be based on your income, your credit score, and other factors.
When you use a credit card to make a purchase or take out a cash advance, you’re required to make a minimum payment toward your balance every month. This minimum payment can vary depending on the card issuer, but it is usually somewhere in the ballpark of 2% to 3% of your credit card balance.
If you pay the full balance on your credit card statement within your grace period, you are not charged interest on that balance. If you don’t pay your balance in full, on the other hand, interest begins accruing on your balance the day after your credit card due date.
Credit cards charge interest on your purchases, balance transfers, and cash advances in the form of an APR — or annual percentage rate. But, don’t let the word “annual” fool you. Credit cards actually charge interest on your balance on a daily basis!
To find the daily interest rate your credit card charges, divide your APR by 365 — the number of days in a year. The result you end up with — the daily periodic rate — is how much interest you’re charged every day you remain in debt.
In addition to interest, some credit cards charge application fees or an annual fee. The vast majority also charge late fees or over-the-limit fees. Depending on the card you sign up for, you may also find cash advance fees, foreign transaction fees charged over overseas purchases, and balance transfer fee. Fortunately, most of these fees are easily avoided.
How to get a credit card
If you think you’re ready to build credit but wonder how to apply for a credit card, we have good news. The internet offers a treasure trove of information that lets you shop around and compare cards without ever leaving your home. Better yet, you can fill out your credit card application online. If you get approved, you can receive your card in the mail in as little as a few days to a few weeks.
If you’re wondering how many credit cards you should have, the answer is different for everyone! Some people like to use one rewards or cash-back credit card for all their regular purchases, while others pick different cards for different situations. For example, people who travel a lot like to have a travel credit card that comes with no foreign transaction fees and consumer protections like trip cancellation/interruption insurance and baggage delay coverage. But they may also want a basic cash-back credit card to use at home.
The basic steps involved in actually getting a credit card include:
- Deciding on the type of credit card you want (low interest, rewards, etc.)
- Researching cards online
- Checking your credit score to see if you may be able to qualify
- Applying for the credit card you want online
Generally speaking, you’ll need to have good credit or a FICO score of 670 or higher to qualify for a credit card with the best terms, rewards, or a low interest rate. For a premier travel credit card from Chase or Capital One, you may even need very good credit — or a FICO score over 740. Because card issuers approve consumers based on many factors and don’t necessarily list minimum credit score requirements, these estimates are just a rule of thumb and not set in stone.
How many credit cards is too many? There’s no real “limit” provided you have a handle on your debt and don’t let yourself get overwhelmed. Most experts agree that a few credit cards (2-5) is probably enough.
How to get a credit card with bad credit or no credit score
If your credit is pretty bad, you may have to start your journey with a secured credit card. Where traditional credit cards offer an unsecured line of credit you can borrow against, secured credit cards require you to put down a cash deposit to secure your own credit line.
Is this ideal? Of course not. Can it help your credit score? You bet.
Keep in mind that your secured card doesn’t have to be your forever card. When you have a secured credit card long enough to boost your credit score, you can cancel it and move onto unsecured cards with better terms and no deposit required.
In addition to secured credit cards, there are also unsecured credit cards for “fair credit,” credit cards for people with a score in the 600’s, and even more options for people with scores over 700. There’s a credit card for everyone but the best rewards, rates, and terms go to those with excellent credit in the end. Find a secured credit card now >>
What is a balance transfer credit card?
If you are struggling with credit card debt, you have probably considered a balance transfer credit card. This type of card offers 0% APR for a limited time — usually between 9 and 21 months. If you’re approved, you can transfer all your balances over and pay zero interest during your card’s introductory period.
Sounds pretty sweet, right? It certainly is, but you have to keep in mind that some credit cards change balance transfer fees between 3% and 5% of your balance. Paying this fee can be well worth it to score 0% APR for up to 21 months, but you should still take note and run the numbers to make sure it’s worth it.
Resource: Find a balance transfer credit card
How to use credit cards to build credit and improve your credit score
Once you have a credit card in your arsenal of tools, it’s crucial to make sure you’re using it to your advantage. Here’s exactly how to use credit cards to build credit and boost your credit score this year:
- Make only small purchases you can afford to pay off right away. When you use your credit card and pay it off, your credit movements will be reported to all three credit reporting agencies. This will help you build credit history and your score over time.
- Keep balances low. Most experts suggest keeping your utilization below 30% for the highest credit score possible.
- Pay your credit card bills early or on time. Don’t forget that your payment history makes up 35% of your FICO score. Late payments can damage your score in a big way, so don’t let them happen.
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How long does it take to improve a credit score?
If you are working on your credit score, one of the main questions you likely have is How long does this shiz take?! After all, you’re likely itching to buy a home, car, refinance debt or make other big, positive changes in your life.
The bad news: This is not a quick fix.
- Errors like fraudulent accounts and duplicate accounts can be removed relatively quickly and increase your score within a couple months
- Improving your credit utilization, and being added as an authorized user on the credit cards of someone with a high credit score — or having them sign on to your card as a co-signer — can also improve your score quickly.
- Hard credit inquiries stay on your credit history for two years.
- Legitimate late payments and collection accounts remain for seven years.
- A bankruptcy remains on your credit history for 10 years.
The good news: This does not mean that these errors will keep your score low forever. It simply means that past bad credit habits will affect your score for a while — but it will not destroy your life.
Use Credit Sesame to get a free credit score >>
Try The Credit People to clean up your credit report >>
Find a secured credit card now >>
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