How Long Will it Take to Improve a FICO Score?

On Wednesday I received this email from reader, Joshua:

Good Morning,

Thank you for reading my email.

My question regards my credit score. I recently got my credit report and score. My score as of right now is a 577 which as you know wont get me very far. I make decent money now and I am paying off my accounts although I haven’t been delinquent since February of ’05. I know that has a negative effect on my credit. But I also noticed that what else is screwing up my credit is the fact that my amount owed is close to the maximum amount I can borrow. I basically took the money that I’m putting towards savings this paycheck and I put it all towards my credit cards along with my usual amount of credit card payments that are in my budget. My question is, how long will these payments take to get to the credit bureaus so that my score can raise? Before I made these payments I had 13.55% of my available credit left and after I made my payments I have 22.26% of my available left. So I guess I have 2 question:

1. How long will these payments take to filter into the credit bureaus?
2. What’s the ideal percentage of available credit to have left?

Thank you,


FICO scores are one of my weaker areas so I sent Joshua’s question to Liz Pulliam Weston, an MSN Money contributor, credit expert, and author of Easy Moneyand Your Credit Score(Affiliate Links). Here’s Liz’s response:

Hi, JLP.

I’m delighted to help out.

Joshua’s score will improve as soon as his credit card companies report the new, lower balances to the credit bureaus. When will that happen? It depends on the lender, but most report once a month, so it should happen within 30 days. (If you check your credit reports, your credit cards will generally show the balance from your most recent statement.)

As to his second question: the less of your available balance you use, the better. I generally advise people to use no more than 30% of their limits at any given time, but you’ll typically continue to see score improvements until you get your credit utilization down below 10% of your limit.

Hope that helps.

Liz Pulliam Weston

Bottom line: Joshua’s on the right course and I respect the fact he is making an effort to pay deliquent accounts even though they can hurt him in the short run. Eventually his FICO score will move up.

11 thoughts on “How Long Will it Take to Improve a FICO Score?”

  1. I don’t know much, but I did have some delinquent accounts in the past also. I believe that after 7 years a delinquency will come off the report. Since his most recent was in 2005, which should come off in 2012, but obviously that is not anytime soon, hopefully he can do other stuff to increase it before then.

  2. Oh, one other thing to note, my last delinquent account was in June 2002, so I am waiting for it to come off in about a year. Even with that on my report I have still gotten my score back up to around 680.

  3. Really the only number he should focus on is the amount of debt. If he is using, before his payment, 87% of his available credit, the only thing he should be focusing on is paying down his debt. A good FICO score is important in the long run, but it always in flux and only really does you any good when you want to get more credit. I would say stop focusing on the FICO score and focus more on the account balances. Once you get the debt payed off, the rest will take care of itself.

  4. Good info from Weston and in the comments. I have one thing to add though.

    In most credit scoring things happen discretely (discreetly too, I hope :-)). In other words, if his debt/limit (utility) ratio goes down 8%, it may not change his score at all. It may not change until he gets it below certain thresholds, and what those thresholds are is not revealed by FICO. It could be that when he goes below 75% utility, his score will bump up. It may happen at 50%, and again at 25%. He should not despair if the bump doesn’t happen immediately or predictably– if we knew how FICO was calculated we could say exactly when to expect it, but we can’t. It may be in 25% buckets or may be optimized thresholds, or some combination, but it’s probably not going to look like a continuous improvement. We don’t know exactly.

    One thing I can tell you for sure is that Weston is right– if he reduces utility from 87% to under 10% he will see a dramatic bump (or several smaller bumps over time). It just may not be predictable exactly when along the way he will see it. Getting those delinquencies in the rearview will make an even bigger difference.

    The important thing is that Joshua is now paying attention to how his behavior affects his score (and ultimately his finances) and is doing the right things. If he continues that, monitoring his score and hoping for bumps won’t be necessary anymore.

  5. The best thing to do at this point is pay the bills on time and not use credit. I was in a similar situation back in 1998, where my FICO score was 540. Basically, there were a ton of lates, and I had some go to collections. Once I started paying the bills on time and lowered the amount of credit I owed in relation to the credit I had, the score started to go up. I was able to get a home mortgage in 2003 with a 690, and since then my deliquencies started to come off of my credit. The deliquency takes up to 7 years to leave, so time is one thing that heals the most (while you are paying on-time). My credit score is now over 800.

    So the good news is that with time and a concerted effort to pay off debt on time, the score will come up. It will take some patience, but there is light at the end of the tunnel if you start making good choices now.

  6. Delinquent since Feb ’05? Are these accounts in collection or just have “late” notations on the tradeline? If the former, the score doesn’t improve with payment on a collection account. The damage is done until the collection account is remove. The below 30% rule applies to revolving accounts that are still with the original creditor.

  7. Single Ma said:

    “Delinquent since Feb ‘05? Are these accounts in collection or just have “late” notations on the tradeline?”

    I don’t know the answer to that. Regardless, I think it is good that he is paying them off since it was his debt.

  8. What most of you are missing is that the FICO credit score basically looks back only two years. Anything, except bankruptcy, tax liens, child support, etc. doesn’t count much, if anything on the score. The most important thing is to pay down current accounts under 33% to improve your score and don’t be late on anything exspecilly your rent.

    Hope this helps.

  9. I’m in the process of purchasing my first home. When they ran my credit, my medium score came up as 584. I had alot of collections– medical, a gas bill and a gym membership with Bally’s. All of the items were very old and paid off in March of 09 except for my car, two credit cards, and a installment loan. My total debt currently is less than 6000.00. I owe 4k on my car, 150 on credit card 1 and 200.00 on credit card 2, plus an installment loan of about 1600.00 remaining. All my bills are paid on time and have been in the past 12 months except Bally’s. I had surgery last year, didn’t go to the gym and missed two months. They reported a 90 day deliquency, would not work with me so, I pulled money from my 401 and paid it off in full in Jan of 09. I’m wondering how long I will have to wait to buy a home. I make pretty good money , but only want to spend around 85k on a house. I’m afraid that the 8000 rebate will long be over by the time I’m ready. I can tell you one thing, I will never ever ever let this happen again. What a nightmare getting everything in order only to find out the damage has been done.

  10. Be sure once you have paid anything off to a collection agency, that you get a release letter stating said account is paid in full. Once you have that letter, FAX it to Equifax..this is who any financial institute will use when pulling a credit check on you.

    Make sure that they receive your letter clearing you from any outstanding debt to them, and within 10-15 business days, your FICO score will improve.

  11. working to establish or improve your credit history takes time. There isn’t an overnight solution, so you have to approach this as a long-term goal. If you’re just beginning to establish credit for the first time, take things slow and begin by opening a few small accounts. With these initial accounts, make sure you use the credit wisely and develop sound habits. It won’t be long and you’ll be on your way to building a great credit history.

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