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How Long Does It Take to Credit Rate Increase?


What is credit rating?

The credit rating is the scoring system that is generated as a result of the aggregation and analysis of all credit transactions such as credit card, need and mortgage loan. When we apply to banks to obtain a credit or credit card, one of the first criteria they consider to give approval is the height of our credit rating.

How long it takes to raise credit rating?

People wonder how many days, weeks or months it takes to raise credit rating. The credit note functions as a bridge between banks and customers. It has a vital importance because it forms the relationships with financial institutions. Therefore everyone wonders when and how much the credit score will rise.

So, how long it takes to raise the credit score to a good level again? In this guide you can get the answer and find some tips to raise your credit rating in the shortest time.

When is the credit rating calculated?

You are added to the credit rating scoring system when you start to use any products like credit, credit card and an overdraft account. Your credit rating is updated every month. This update becomes visible in your credit score report every 45 days.

When your score is updated, some credit score factors announced by the consumer reporting agency are considered. Each of these factors affect your credit score on a basis.
  1. Credit and credit card paying habits. (affects 35%)
  2. Existing indebtness and the situation of the account (affects 35%)
  3. New credit taking (affects 11%)
  4. Credit usage frequency (affects 10%)
  5. Unidentified other factors (affects 9%)
For instance, if you pay your credit card debts or credit debts when due your credit score will be affected well. Therefore aged debts will affect your credit score adversely.

How long it takes to raise credit score?

If you understand the factors that affect the credit score and take financial actions considering these factors your credit score will rise in the first month.

And of course, it may take 3 or 6 months to raise your credit score to a good level. If there is no legal proceeding, as long as you watch out the factors that affect the credit score, your credit score may reach the highest levels again in 1 year.

During a credit application…
Applicant’s credit score interval and how banks consider

Score Appearance
0 – 799 very risky
800 – 1299 middle risk level
1300 – 1499 low risk level
1500 – 1699 almost good
1700 – 1900 great

What to do to raise credit score in the shortest time?

Paying the minimum amount does not affect the credit score adversely but making it a habit and spending more than you can pay may cause problems with your credit score. Reducing your credit card debts to minimum or directly setting to zero and spending the amount of money that you can pay in 1 period will affect your score well.

Regular payments are among the factors that affect the credit score most. By paying credit and credit card debts always on the day and regularly you can make your credit score rise.
In contrast to the common belief, using high limits does not affect your score well. Using adequate limits for you needs instead of using high limits will be better for your credit score.
To sum up, if you watch out your financial life and take necessary precautions, you can increase your credit rating in 1 year at the latest.

1 comment:

  1. Good view point of analysis....well written content...Thanks for giving the information.
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