Lauren Smith, WalletHub Staff Writer
@laurenellesmith
It takes up to 30 days for a credit score to update after paying off debt, in most cases. The updated balance must first be reported to the credit bureaus, and most major lenders report on a monthly basis – usually when the account statement is generated.
Credit scores reflect the contents of credit reports, so the paid off debt will impact your credit score once it is added to your report. As a result, how long it takes for a credit score to update will depend on the creditor and the timing of your payment.
The magnitude of the change in your score is also contingent upon a number of factors, but paying off debt will likely help your credit. Generally, your score could increase by approximately 10 to 50 points if you pay off 25% of your credit card balances. If you pay off 100% of your credit card debt, your score could increase by 100+ points.
You can use WalletHub’s free credit score simulator to find out how paying down debt will affect your credit and get personalized credit-improvement tips from our analysis tools.
The Bigger the Creditor, the Faster Your Score Will Update
Most large creditors report user activity to credit bureaus once a month. In this case, you can expect to see the payment reflected on your credit history within 30 days of payment.
On the other hand, if your creditor is a smaller entity, they may only report activity to credit bureaus once a quarter. In this situation, it’s possible payments may take months to appear on your credit report.
What to Do When You Can’t Wait for Your Score to Update
Sometimes, it won’t be practical to wait a month or more for your credit score to update. Maybe you’re thinking about a big purchase like a house or a car, for example. In these situations, there are a few things you can do to speed up the process of updating your credit report. They all have limitations, however.
Rapid Rescoring May Help: With rapid rescoring, you work with a lender to report recent credit activity to the credit bureaus so that your credit report and score update sooner than normal. Instead of waiting for changes to your credit history, you pay off a debt and your lender requests an update from the credit bureaus to get your new score in 3-5 days. Lenders are not allowed to charge for rapid rescoring as a separate service, so they will most likely build it into their fee.
Add Bill Payments to Your Credit Report: Rent and utility bills usually aren’t reported to the credit bureaus. However, services like Experian Boost, eCredable Lift, and UltraFICO use banking information to add new account entries and details to your credit report. Basically, customers can allow access to their bank accounts for a potential score increase based on bill payments that usually wouldn’t be taken into account.
Contact the Credit Bureaus Directly: If your credit report does not reflect a recent payment on a debt, you may need to contact the credit bureau directly to have them correct the error.
How to file a dispute online:
- Sign into your account with the credit bureau.
- Select the reason for your dispute and submit any documentation that supports your claim.
- Submit your dispute.
- Wait for a response (typically within 30 to 45 days).
Bottom Line
Your credit report should update about 30 to 45 days after paying off a debt. Whether or not your score changes depends on the rest of your credit history.
You can track your progress with free daily credit score updates from WalletHub.
People also ask
How much will my credit score increase after paying off credit cards?
Your credit score could increase by 10 to 50 points after paying off your credit cards. Exactly how much your score will increase depends on factors such as the amounts of the balances you paid off and how you handle other credit accounts. Everyone’s credit profile is different.
You can estimate how much your credit score is likely to change after getting out of credit card debt using WalletHub's free credit score simulator.
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It usually takes up to 30 days for your credit to improve after paying off a credit card. The exact timing depends on when your billing cycle ends and when the credit card issuer reports the payment to the major credit bureaus. Lenders typically report once a month. Paying off a credit card does not always lead to credit score improvement, though.
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The best way to pay off debt and raise your credit score is to repay balances with the highest interest rates first. This will reduce the overall cost of repaying the debt and make the task easier because the total amount you owe won’t be growing as fast. Always make at least the minimum payment due for each balance every month, though. Keeping all accounts current will help raise your score, or at least prevent...
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