If you’re working to improve your credit score, you may be wondering a few things: “How often is my credit score updated? Why does my credit score change? What does the credit score update process look like?”
In general, your credit score is updated every 30 days. Your credit score updates as information is added to your credit report. Your creditors share new information about your credit usage with Equifax and TransUnion. This new information is added to your credit report each month and can cause your credit score to either increase or decrease.
Different creditors report this information at various times throughout each month, so your credit score can sometimes change before 30 days. You can use Borrowell to get free credit score and credit report updates every single week.
What is the Credit Score Update Process?
Each month, your creditors provide new information to credit bureaus about your credit usage and financial activities. The credit bureaus take that information and update your credit report, which causes your credit score to update. The information that creditors share with credit bureaus includes:
Whether you made on-time payments towards your credit accounts
Your current credit balances compared to your credit limits
How long your credit accounts have been open
Whether you’ve opened any new types of credit accounts
Whether you applied for any new loans or credit accounts
Whenever information is added to your credit report, it can impact your credit score. This is because the main factors that are used to calculate your credit score are:
Creditors share new information every month at various intervals. This means that your credit report may look different each time you check it. You should regularly monitor your credit report to understand how new information may be impacting your credit score.
How much can my credit score change in an update?
As your credit report updates each month, you’ll likely see gradual changes to your credit score. Improving your credit score takes time and discipline, so don’t be discouraged if you don’t see immediate increases to your credit score after changing your financial habits. As more and more positive information is added to your credit report, like on-time payments, good credit usage, and long credit account history, you will see improved scores over time. Long-term score improvements are more important than daily or weekly fluctuations.
Some credit report updates can immediately cause your credit score to drop. The biggest items that could cause your credit score to drop include the following:
A late payment was reported by your creditor
Your credit utilization has become too high
You recently applied for new credit
A large number of hard credit inquiries were made on your credit report
You cancelled an old credit card
Collections, judgements, or bankruptcies were added to your credit report
Late payments are one of the biggest factors that can cause sudden changes to your credit score. One missed payment can cause your credit score to drop by up to 150 points if it’s added to your credit report. On the other hand, when a missed payment is removed from your credit report, your credit score could suddenly increase.
If you’ve fallen behind on a payment, you should contact your creditor as soon as possible to discuss your options. See if you can be given an extension or put on a payment plan so that your missed payment isn’t added to your credit report. The longer you wait, the more of an impact it will have on your credit score.
High credit utilization can also cause sudden changes to your credit score. If you rack up a large amount of credit card debt one month, this will show up on your credit report and negatively impact your credit score. If you suddenly pay down a large amount of your credit card debt, you’ll likely see an immediate spike in your credit score. To keep your credit score healthy, you should aim to keep your total credit utilization under 30% every month.
Some negative information, like collections, judgments, and bankruptcies, will have more severe impacts to your credit score if they’re added to your credit report. Negative information can remain on your credit report for seven years, so you should regularly review your credit report and see if any negative information has been added.
If you believe that incorrect information has been reported to credit bureaus, there are ways to dispute the information on your credit report. Errors on your credit report will keep your credit score below where it should be. Disputing errors on your credit report can be a tangible and immediate way to improve your credit score.
The Bottom Line
Your credit score updates every 30 days because new information is added to your credit report. Your creditors notify Equifax and TransUnion about your current credit balances and whether you’ve paid your bills on time, among other things. Your credit report regularly changes and directly impacts what your credit score looks like.
To stay informed and up-to-date, sign up for Borrowell. You can use Borrowell to get free access to your credit score and your Equifax credit report. You’ll also receive credit score updates every single week, so you can get a constant view of how your financial habits are helping you improve your credit score.
Evan is the Content Marketing Manager at Borrowell. Evan is passionate about personal finance, and his articles on financial trends have been featured in publications including the Financial Post and BNN Bloomberg. In his spare time, he enjoys playing and listening to music.