You finally paid off those long-overdue debts, and things are looking up. Now you need a new loan to make that important business investment. You know your credit score was hurt badly, but now you are fixing things. How long will it take for your credit score to rise again?
Some factors in your credit score will remain on the books for a pretty long time. Defaulted payments, foreclosures, tax liens and other major issues are allowed to remain on your credit report for up to seven years. Chapter 7 bankruptcies can last 10 years on your report.
Your credit score is an indication of how reliable you are as a borrower. Correcting these issues will help your score, but it may be a slow process. That's because it is not just about the money, it's about you as a borrower. Bankruptcies, missed payments and foreclosures, even if you have resolved them since then, still call into question how safe a bet you are.
When these are corrected, the effect is more instantaneous. You have a right to receive a full credit report – you can get one here – and review all of the items that are negatively affecting your score. There are, sometimes, things that are simply not correct. Follow the procedure for disputing them, and make sure that the creditor in question agrees to remove the offending item from your report.
Disputing mistakes on your credit report must be done in writing. The three credit agencies, Experian, Equifax, and Trans Union, are required to respond to your written dispute within 30 days. There are services that can help you with this. See the bottom of this article.
Yes. Proving you are a reliable user of credit can have a relatively quick impact on your score.
How do you do this? By having credit and using it moderately. In other words, if your credit card allows you up to $15,000, and you use $1500 a month and pay it in full, that helps your credit score quickly. Not using the credit at all does not help. The idea is to use credit responsibly, and have a lot of it available.
The main factor in credit score calculation is your reliability in paying. Make sure you do no more damage, and pay your bills in full. There are companies that will handle this process for you, especially in cases where there is a disputation of items on your credit report. Get me out of debt.com is affiliated with a number of credit repair agencies. If you need to rapidly improve your credit score, they may be able to help you.
These firms offer professional, legally supervised credit repair and services
Credit Karma gets you your credit report and score for free, as well as being a resource for balance transfer and other credit cards.
A credit repair firm with a free consultation. Ranked #1 in challenging bad items, with a 90 day guarantee.