Many people wonder if it’s possible to raise your credit score 100 points overnight. The short answer is no – but you can take steps today to help you boost your credit score quickly (just not that quick!).
Whether you like it or not, your credit score affects your daily life. Everything from getting approved for a loan to getting a job can be dependent upon having a good credit score.
If you are a fan of Dave Ramsey, you know his stance on credit scores. If you’re not, I’ll sum it up quickly: essentially, Dave thinks you should pay for everything in cash. When you do this, your credit score will disappear, since you no longer have any accounts for it to base your “credit worthiness” off of.
While Dave Ramsey doesn’t approve of worrying about a credit score, there are still a lot of reasons to do so. Unless you can pay cash for everything – and I mean everything, like a house – you’re going to need to have a good credit score.
Until you can pay for everything in cash, it’s important to know your credit score and pay attention to it. Having a good credit score can also help you save money in the long run as well.
Why Do I Need a Good Credit Score?
Your fico score, or credit score, is important in determining your interest rates on loans, mortgages, cars and credit cards. If your credit score is horrible, you will not be able to get a lower interest rate. Which in turn means that you’ll be paying more for the same products as people with great credit scores.
Having a great credit score means saving money in the long run. Here are the most important tips to learn how to boost your credit score.
Having a good credit score is unfortunately important in today’s world, whether we (and Dave Ramsey) like it or not. Just look at all the items throughout your life that your credit score can affect:
- Your ability to get a job since employers now check credit scores
- You ability to get a loan
- Your ability to get a good interest rate on that loan
- Where you buy a house, your mortgage rate and how big of a house you can buy
- Your relationships
- If you can rent or lease an apartment or car
- The cost of your car or home insurance
- If you have to put down a deposit when opening utility accounts
- Starting a business
What is a good credit score?
There are 5 levels of credit scores accordining to Experian.com (one of the three main credit bruearus). They are:
- Poor: 300 – 579
- Fair: 580 – 669
- Good: 670 – 739
- Very Good: 740 – 799
- Exceptional: 800 – 850
So if your credit score is 550 and, you definitely want to raise it because that’s a bad credit score. The higher credit score, the better. Keep reading on to learn more about how to boost your credit score overnight.
How can I raise my credit score instantly?
Unfortunately there’s no quick way to raise credit score 100 points overnight (unless you figure out how to change your credit score illegally…which most likely involves hacking three credit bureaus and making a huge mess. Just do the work, it’s easier, I assure you!). You can’t raise your credit score significantly in 24 hours, either.
You can increase your credit score by 100 points in 3 months or more by following the steps listed below. While they’re not a ton of work, just like a fine wine, they will take some time. The longer your accounts age, the more points they’ll give you.
How to Increase Credit Score to 800+
Everyone wants to know the fastest way raise your credit score 100 points overnight, so let’s dig in, shall we? There are several factors that make up your credit score:
- Payment History (35% of credit score)
- Credit Usage (or, Credit Utilization Ratio) (30% of credit score)
- Credit Age (15% of credit score)
- Account Mix (10% of credit score)
- Credit Inquiries (10% of credit score)
I’ll go into detail about each so that you understand how each affects your credit score, and how heavily it weighs on determining your score. But first, grab a copy of your credit report and credit score and we’ll get into how to boost your credit score.
1. Get Your Credit Score
Luckily, you can get your credit score for free at Credit Sesame. Just answer some basic questions, create an account and login to check your score.
Credit Sesame also helps you to analyze your credit score and tells you how you can improve it. I like it because it’s feedback that’s tailored to your specific situation, which takes out a lot of the guesswork. They also provide additional services, like credit monitoring to make sure that there’s nothing fishy going on with your credit.
Another good free monitoring option is Credit Karma. I’ve tried this one as well, and both are great! I appreciate getting alerts whenever something changes, so I feel more secure knowing that it’s easier to keep an eye on my credit.
2. Review Your Credit Report for Mistakes
Begin by getting a copy of your free credit report at Annual Credit Report. You can do this once a year for free. It will not give your credit score, but you can review it for discrepancies in your credit history.
If you find any accounts that you didn’t open or that are incorrect, you need to address them immediately and deal with any negative items as well. Start by contacting the credit bureau that’s showing the account and asked to have it removed.
I suggest sending a letter via certified mail with copies of the credit report and any documentation showing proof of inconsistencies. Ask them to investigate the account in question. They have 30 days from receiving the letter to review the issue, and then remove it.
3. Contact Creditors About Recent Late Fees
It’s important to make sure that any accounts that are open are in good standing, otherwise, they will kill any chance of a good credit score.
If you have recent late fees, you can kindly call and ask your creditor for a pass. See if you can get them to drop the late fee. If so, it should remove the late payment on your credit report. Otherwise, those late payment notifications will stay until the loan is paid off and closed for good.
Payment history makes up a whopping 35% of your credit score. Set reminders to pay your bills on time. Print and mark up a calendar. Whatever it takes, make sure that you’re paying those bills on time every month.
Want to know how to increase credit score immediately? Start with on-time payments. Current on-time payments will impact your score more than old late payments. Get on a schedule and pay those bills first.
Not only will this up your credit score, but you’ll sleep better at night knowing those payments are taken care of.
If you aren’t making enough to cover your bills, check out this article on 11 simple ways to save money on a tight budget.
4. Pay Down Your Credit Cards or Loans to below 30% Utilization
One large factor in your credit score is your credit utilization. It makes up 30% of your credit score and paying down your debt will increase your credit score quickly.
This means that if you have a credit card with a $10,000 limit, and a $5,000 balance, you’re at a 50% credit utilization rate. Which is not good.
The lower your credit utilization rate, the better. You want it below 30%, but lower than 10% will get you the best rates from lenders, so pay down those high balances.
Do not go out and open additional credit cards, resulting in a credit limit increase (though any credit card issuer would love that!). Chances are you’ll end up using the available credit and gaining more debt, and also end up lowering your credit score.
The best way to drop your credit utilization score is – you guessed it – make a payment on your credit card debt. Knock off anything you can in order to get those credit card balances and percentage to drop. This will have a much bigger impact on your credit score than getting a late payment mark removed.
Consider picking up a temporary side hustle to make some extra cash to get those credit cards paid down. If you need some inspiration, here’s a list of online side hustles you can start this weekend.
5. Mix Your Accounts Up
Creditors and lenders want to see a variety of accounts, including installment loans like credit cards, home loans, student loans, car loan, and any other types of personal loan. Having a credit mix of differently types of monthly payments can be beneficial to your credit score.
Luckily, this only makes up 10% of your overall credit score, so don’t run out and grab an unnecessary loan just to give yourself variety. It’s not enough to bump your credit quite that much, so don’t worry about it if you don’t have a variety in your account types.
6. Keep Your Accounts Open
I know this sound contradictory, but you don’t want a new account, you want old ones. If you pay off a credit card, keep it open. The older, the better.
Credit age is based on an average age of your accounts. You want to try and have an average over five years if possible. So keep those accounts open – but cut up those cards!
Credit age makes up 15% of your credit score, and it’s a relatively easy task to accomplish. It doesn’t hurt if you choose to close a very recently opened card, but definitely keep any of the older accounts open.
Having 12 credit cards isn’t going to help either. Lenders want to see a variety, not quantity. This is my lowest credit rating on Credit Sesame, since I only have a couple of credit cards and a mortgage. And I’m totally fine with that! It’s worth it to drop the student loan and car payments we had earlier this year.
7. Keep the Number of Credit Inquiries Down
Every time you apply for a new loan, credit card, or mortgage, it’s a credit inquiry. You want to keep it down to only two per year, if possible.
Credit inquiries have a 10% impact on your credit score, so don’t apply for every store credit card you’re offered just to save 30% on your purchase that day.
This also means that if you don’t have a lot of credit accounts open, don’t open too many too rapidly. Spacing them out and opening only what you really need will boost your credit score much more. Opening too many at once will lower your score and it’ll take a year to fall off your report.
8. Pay your bills on time.
You won’t raise credit score 100 points overnight by paying your bills on time or before their due dates, but you will boost your score overall. Late and missed payments will hang on your credit reports for a long time, so make sure that you’re not undoing all your hard work by missing payments.
9. Consider becoming an authorized user on a family member’s account.
I don’t put this one out there lightly. I’m not a super huge fan of putting family members on your accounts, however, it is one way to build credit. BUT – and that’s a big but! (ha) – that family member has to have exceptional credit usage. This means that they aren’t late with payments, don’t default on loans, and are overutilizing their credit lines.
You don’t have to use their card or account in order for this to show up on your credit report, you just have to be an authorized user. So while it won’t raise your credit score 100 points overnight, it can absolutely give your score a big boost.
10. Try a secured credit card.
If your credit score is really low, consider trying a secured credit card like this one. You’ll be approved for a very, very small amount (think $500). You’ll pay that much upfront so that you if you default, the credit card company hasn’t lost any money. Think of it as a deposit that you’ll eventually get back when you close the account.
How long does it take for your credit score to update?
Depending upon the changes you make and how much they affect your score, you can start to see improvement in your score within 30 days. Lenders generally report to the credit bureaus once a month, so any changes will appear monthly.
Will it be enough to raise your credit score by 100 points (or even 200 points) in 30 days? It’s hard to tell since everyone’s situation is different, however, you will definitely be on the right track to increasing your credit score. Remember, fixing your credit is going to take a little time. So the sooner you start, the better!
How fast can you raise your credit score?
The burning question on everyone’s mind: how fast can you raise your credit score? Your specific situation and the changes you’ve made will dictate how fast you can raise your score.
But weary of any companies that promise fast results. Often, they can backfire and actually cause a lower score.
If you want tips to boost credit score quickly, your best bets are paying on time and lowering your credit utilization. Those items will give you the most bang for your buck. The others might take a bit, since they are based on time.
Remember, the key to boosting your credit is consistency. Being consistent with on-time payments, your credit utilization ratio, and keeping older accounts open will be the fastest way to fix your credit score.
Having a great credit score affects so much more than being able to get a loan at a low interest rate. It can affect everything from finding a job to how you raise your kids.
It’s important to not only check your credit score through a service like Credit Sesame, but to also keep checking it. You’ll want to pay attention to any changes that appear and address them as soon as possible to keep your credit score up.
Will Being Debt Free Affect Your Credit Score?
A debt free credit score could possibly be higher because your credit utilization will be zero. However, if you don’t have a good mix of types of credit, haven’t had the accounts open long, or have opened too many too recently, your score could possibly be lower than someone with outstanding debt.
While you’re not going to find Dave Ramsey free credit score services any time soon, understanding the factors that build a credit score are important. Once you’re debt free and are able to pay cash for literally everything in your life, that score will matter whether you like it or not.
Now that you know you can’t raise your credit score 100 points overnight, which steps have you taken to get the process started? How long did it take to see a change? Let me know in the comments!
