How Long Does It Take to Build Credit?


HOW FAST CAN YOU improve your credit score? If you need to borrow money but have poor credit – or no credit score at all – it can feel like an eternity before the number is acceptable to lenders. With positive changes in your credit managing habits, you can see credit score improvements occur in as little as one month.

But exactly how long does it take to repair credit or even build it from scratch? Here’s what you need to know.

How Long Does It Take to Build Credit From Scratch?

For a score to be generated, FICO requires that you have a minimum of one credit account that’s been open for six months or more and at least one account with activity that’s been reported to the credit bureau within the past six months. It’s possible for one account to satisfy both of those requirements.

FICO’s third requirement for generating a credit score is that there can’t be any indication on your credit reports that you are deceased. That might sound strange, but it can happen if you shared an account with someone who was reported deceased.

As far as what your score will be once it’s generated, “it will depend on how many accounts you open, as well as how much you’re using your credit,” says Leslie H. Tayne, debt resolution attorney at Tayne Law Group in New York and author of the money management book “Life & Debt.”

“When you’re first building credit, it’s important to start off on the right foot, so make sure you can make all your payments on time every time and try to pay down your balances in full,” Tayne says. Overextending yourself right off the bat will only lengthen the credit building process.

How Long Does It Take to Improve Your Credit Score?

The timeline can be tricky for improving a bad credit score. It will largely depend on how bad your credit is to start. “If you’re dealing with some serious damage, it could take several years to build it back up,” Tayne says.

For example, serious negative marks such as a collection account, foreclosure or bankruptcy will stay on your record for about seven years. Even so, their impact will fade with time. A collection account that is five years old, for instance, will drag down your score much less than one that’s just five months old, according to FICO…Read more>>