Credit Score: How long does it usually take to improve it? Find out | Mint

Improving your credit score can take a long time based on your current score, financial habits, and the specific actions you take.

You can take an appropriate action based on the goal i.e., whether you want to improve your credit score in the short term, medium term or long term.

Short-Term Improvements

This includes correcting errors which may have crept in your credit report and reducing credit utilisation which should be lower than 30 percent.

If there are errors in your credit report (such as incorrect loan balances or missed payments recorded in error), you can dispute them with credit bureaus such as CRIF.

Resolution typically takes anywhere between 30 to 45 days, and correcting these errors can boost your score quickly.

Reducing Credit Utilisation: If your credit card balances are high, paying them down to keep utilization below 30 per cent can improve your score within one or two billing cycles.

Medium-Term Improvements

This takes anywhere between 3-12 months and can happen by timely payments. Consistently paying all EMIs and credit card bills on time is one of the most effective ways to improve your score. The positive impact will start reflecting after 3-6 months of on-time payments.

Building a Healthy Credit Mix: A balanced mix of secured (e.g., home or auto loans) and unsecured loans (e.g., credit cards, personal loans) can enhance your score. However, this takes several months of disciplined repayment.

Long-Term Improvements

It takes 12 plus months that can happen by establishing credit history and clearing defaults.

If you are new to credit, it can take 12 to 24 months of responsible borrowing and repayment to build a strong score.

Clearing Defaults: If you’ve defaulted on loans or credit cards, repaying them and ensuring no new defaults will gradually improve your score. However, the negative mark can take up to 7 years to fall off your report.

It is quite vital to check credit reports regularly. One should use platforms such as CRIF High Mark to monitor credit score.

Additionally, one should avoid frequent credit applications. Each hard inquiry can temporarily lower your score.