By Mike Faden | American Express Credit Intel Freelance Contributor
4 Min Read | November 06, 2019 in Credit
It can take up to a month or more for financial activity to affect your credit score—most accounts report monthly.
Important factors include when in your billing cycle the activity occurred and when that account reports the information.
In theory, your credit score could change more than once a day!
How often does your credit score update? It’s an important question if you’re trying to get your credit into top shape—particularly if you’re shopping for a new car, applying for a mortgage, or undertaking any of the many other transactions that require a credit check.
More specifically, how long does it take for potentially credit-boosting activities, like paying down credit card balances, to appear in your credit report and lift your credit score? Conversely, how long could it take for a financial slip-up, like a missed payment or unusually high monthly credit card balance, to drag down your score?
As is so often the case with financial matters, simple questions don’t always have simple answers. The answer to how often your credit score updates is, unfortunately, “it depends.” As a guideline, credit bureaus suggest allowing at least a month for financial activity to be reflected in your credit report, at which point it can influence your credit score. But it could happen much sooner. And just to complicate things further, a score could change several times within a single day as information from different accounts reaches the credit bureaus.
If you’re feeling confused, it may help to understand a little about how the credit scoring process works.
Lenders, credit card companies and other creditors report information about your financial accounts to the credit bureaus (the biggest of which are Equifax, Experian and TransUnion), typically once a month. The information includes key data points that can affect your credit score, such as whether you’re paying on time, your debt level, and your credit limit. As the bureaus receive the information, they incorporate it into your credit report.
When you apply for a credit card or a loan, the company that’s assessing your application sends a credit inquiry to one or more of these bureaus. In response to that inquiry, the credit bureaus feed the information in your credit report into a credit-scoring algorithm, which then generates a credit score in real time.
Of course, your payment activity can only influence your credit score after it’s reached the credit bureaus. But it’s hard to predict exactly when that will happen, because credit reporting is voluntary and there are no rules for when companies should report your information to the bureaus. As a result, each lender and creditor has its own reporting schedule, and some companies don’t report at all. Furthermore, each bureau has relationships with different financial institutions, so some loans may be reported to one bureau but not to another.
And there’s no guarantee that any single payment activity will affect your credit score. Building credit can be a lengthy process that often requires a sustained track record of positive activity, like on-time payments.
So despite the uncertainties, are there any general guidelines for how long it takes to update your credit score? Yes, according to the credit bureaus. TransUnion, for example, says that it can take a month to 45 days for activity to be reported to credit bureaus.1 Experian is equally cautious, saying that it can take more than a month before the payoff of an account balance is reflected in your credit report. To be certain, it’s necessary to pay off the balance to zero and then not make any charges for a full billing cycle because the amount reported to Experian comes from your monthly statement.2
Still, in some cases account information can reach the bureaus much faster. Credit card companies and lenders often report at around the same date that they create your monthly billing statements. So payments made just before the statement date could be quickly reported to the bureaus, while payments made just after that date could take much longer. Furthermore, even though monthly reporting is the standard, some lenders report more frequently, especially when there are substantial changes such as an account payoff or closure.
And because each creditor has its own reporting schedule, the credit bureaus may receive a stream of reports from different companies throughout the month. So again, your credit score could change from day to day—or even several times within a single day.
There’s no single answer to the question of how often a credit score is updated, largely because each lender has its own schedule for reporting information to credit bureaus. Some bureaus suggest allowing at least a month for payment activity to be reflected in your credit report, but it can happen faster in some cases. In theory, your score could change several times within a day, as new information reaches the bureaus from different companies.