Improving Credit Score

All - I'm in my mid-20s with almost no credit history. My credit score is 670 and I'm hoping that if I treat this card like a debit card (i.e. use the credit card for small purchases then immediately pay it back), I can improve my score in short time. Does anyone have experience building credit and how long does it take?

Comments (10)

Most Helpful
Jul 13, 2019

I can help, I had an 800+ score by 22.

Set the card to auto pay in full on the due date, don't pay it off immediately because then it will report that you're not using it.

Keep credit balances under 10% utilization, meaning if your card has a $2,500 limit, don't spend more than $250 on it. Keep that number under 10% per card and for your overall credit card portfolio. As you get more cards/ higher limits, this will become a usable number. I'm sitting on something like $40k between my four cards, and they rarely if ever go over 10%.

A huge factor in credit score is time. Your average age of accounts and history of paying on time will do the most for you, so a lot of it is just waiting. I was able to cheat this a little and was added as an authorized user to one of my parents cards when I was 18, and it was reported that I had had a card since '96.

Don't apply for a ton of credit at once, or even within a year. Each time they pull your credit, it's a hard pull, and for me, has dropped my score between 0-20 points each time. It stays on your account for 2 years, but the damage starts going away after 6 months or so.

Hope this helps!

    • 5
Jul 22, 2019
MonopolyMoney:

I can help, I had an 800+ score by 22.

Set the card to auto pay in full on the due date, don't pay it off immediately because then it will report that you're not using it.

Could you please explain this further. I always pay off my balances to zero and I think it's hurting my score.

Sep 8, 2019

The card will only report once a month, and if you pay it off like a debit card (immediately) it will report as you not using the card. If you set it to auto pay in full on the due date, it will report a balance, but you are not charged interest unless you miss the payment.

Example:
Card is due on the first of each month. You use it through September, your due date for those charges isn't actually until November 1st, but your card will report October 1 as having a balance. If you paid it off before October 1st, you will report as having a $0 balance. You basically get a 1 to almost 2 month interest free loan on all charges.

Second example: I bought a new car in late December and put the entire down payment on my card, that charge wasn't actually due until the next statement date, which was mid February. Basically got a 1.5 month interest free loan plus all the points accrued.

    • 2
Jul 26, 2019

I think credit scores are established over time. Although there are methods to improve a credit score fast, re-establishing a good score takes consistent behavior and time. Factors that influence a credit score include: credit payment history, length of credit history, new credit accounts, new credit inquiries, credit accounts in use.

Just enjoy my life people and you!

Sep 10, 2019
MonopolyMoney:

I was able to cheat this a little and was added as an authorized user to one of my parents cards when I was 18, and it was reported that I had had a card since '96.

I am in the same boat. When I opened my own card with the same provider they gave me a credit limit equal to 20% of my salary.

Stay strong!

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Jul 15, 2019

Thanks for the tip! Why will it not report that I'm not using it if I pay off the balance before the due date?

Jul 20, 2019

Card only reports on or around the due date typically.

Jul 26, 2019

I think credit scores are established over time. Although there are methods to improve a credit score fast, re-establishing a good score takes consistent behavior and time. Factors that influence a credit score include: credit payment history, length of credit history, new credit accounts, new credit inquiries, credit accounts in use.

Just enjoy my life people and you!

Sep 8, 2019

i have no credit score and am in mid 20s. my parents have always paid everything down in cash and told me to do the same. horrible idea and i have to start building credit now or else it will be a pain in the ass to move into newer apartments..

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Sep 11, 2019
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