Your credit score helps lenders decide whether to approve you, how much you can borrow and how much interest you pay. It can feel like a mystery, but the things that move it most are simple and free: paying on time and keeping your card balances low. These 15 ways show you how to see where you stand, fix what is wrong and build credit, even if you are starting from zero.
Quick answer
To improve your credit score, pay every bill on time and keep your credit card balances low, since those two things make up about two thirds of a FICO Score. Check your free reports at AnnualCreditReport.com, dispute anything that is wrong, and avoid opening a lot of new accounts at once. If you have little or no credit, a secured card or a credit builder loan can help you start.
- Payment history is about 35% of a FICO Score. Never miss a due date.
- Keep card balances under 30% of your limits. Under 10% is even better.
- Your credit reports are free every week at AnnualCreditReport.com. See way 1.
- Checking your own score never lowers it.
On this page
The 15 ways at a glance
Know where you stand
Fix problems on your report
Build habits that raise your score
Build credit from scratch
Know where you stand
1Get your free credit reports every week
Go to AnnualCreditReport.com or call 1-877-322-8228. It is the official place for free reports from Equifax, Experian and TransUnion, and you can now check each one every week. Read every account, balance and address, and write down anything you do not recognize or that looks wrong. That list is where the next steps start.
2Check your score for free
Many credit card companies, banks and other lenders show a free score in their app, your online account or your monthly statement. Nonprofit credit counselors can often give you a free report and score, too. Checking your own score is a soft inquiry, so it will never lower it. Be careful with sites that offer a "free" score through a trial, since some start charging a monthly fee if you do not cancel in time.
3Learn what moves your score
FICO Scores, used by 90% of top lenders, run from 300 to 850. They are built from five things: payment history (35%), amounts owed (30%), length of credit history (15%), new credit (10%) and the mix of credit you have (10%). Paying on time and keeping balances low make up about two thirds of the score, so start there.
Fix problems on your report
4Dispute mistakes with the credit bureaus
If something on a report is wrong, contact each bureau that shows the mistake, and the company that reported it. Disputing is free. Say exactly what is wrong, send copies of any proof, like a receipt or a letter, and keep a record of what you sent and when. The bureau generally has 30 days to look into it.
5Get current on any past due account
A late payment can stay on your report for seven years, but it counts less as it gets older, so the sooner you get current, the sooner your score can start to recover. If you cannot pay the full past due amount, call the lender before it gets worse and ask about a hardship plan. Our guide on how to manage debt walks you through it.
6Stop fraud with a free credit freeze
While a credit freeze is on, nobody can open a new credit account in your name, including you. It is free to place and lift, it does not affect your score, and you set it up with each of the three bureaus. You can lift it for a short time when you apply for credit. If you find accounts you did not open, report it at IdentityTheft.gov to get a free recovery plan.
7Get free help from a nonprofit credit counselor
A certified credit counselor can often pull your report and score for free, go over them with you, and help you make a plan for your bills and debts. Most agencies in the National Foundation for Credit Counseling (NFCC) offer counseling for free. Reach one at nfcc.org or 877-360-6322.
Build habits that raise your score
8Pay every bill on time
Payment history is the biggest part of a FICO Score, about 35%. Even when you cannot pay a credit card in full, pay at least the minimum by the due date every month. If you do miss one, pay it as soon as you can. A past due account generally does not show up as late on your report until the payment is 30 days behind.
9Turn on autopay for at least the minimum
Set up automatic payments for at least the minimum on every card and loan, or turn on payment reminders in your bank’s app. Make sure the money will be in your checking account on the payment date. You can always pay more by hand when you have extra. For help finding room in your budget, try the 50/30/20 budget rule.
10Keep your card balances low
Your credit utilization is how much of your card limits you are using. With a $1,000 limit and a $300 balance, you are using 30%. Many experts say to stay under 30%, and FICO says lower is better, with under 10% helping build a good score. Card companies usually report your balance as of the statement closing date, so paying before that date can lower the number they report.
11Keep old cards open
Closing a card wipes away its credit limit, so the balances on your other cards suddenly use a bigger share of your credit and your score can drop. Unless a card has an annual fee or tempts you to overspend, keep it open, use it for a small bill now and then, and pay it off. Check unused cards once in a while to make sure no one else is using them.
12Apply for new credit only when you need it
Applying for a card or loan usually adds a hard inquiry to your report. For most people one inquiry takes less than five points off a FICO Score and only counts for a year, but several in a short time add up. Shopping for a car loan, mortgage or student loan? Do it within about two weeks, since FICO Scores count those inquiries in a short window as one.
Build credit from scratch
13Get a secured credit card
With a secured card, you put down a cash deposit, and the bank gives you a credit limit that matches it. Use it for one small bill a month and pay it in full. Before you apply, ask whether the card reports to the credit bureaus and what fees it charges. Many secured cards let you move up to a regular card after a stretch of on time payments.
14Try a credit builder loan at a credit union
With a credit builder loan, a credit union or bank puts a small loan, often $300 to $1,000, into a locked savings account. You pay it back in small monthly payments over six to 24 months, those payments are reported to the credit bureaus, and you get the money at the end. You build a payment history and a bit of savings at the same time, which is a good start toward an emergency fund.
15Become an authorized user
A family member with a strong record of on time payments can add you to their credit card. Ask the card company first whether it reports authorized users to the credit bureaus, since not all do. Choose carefully: if either of you runs up big charges or misses payments, it can hurt both scores. Only the main cardholder is responsible for the bill.
What can hurt your credit score
- Credit repair companies that want money before they do any work or promise to remove true negative items. You can dispute real mistakes yourself for free.
- Closing your oldest or unused cards, which can push your utilization up.
- Running your cards close to the limit. A high balance on your statement can lower your score even if you pay it off later.
- Missing payments. A late payment can stay on your report for seven years.
- Applying for several cards or loans in a short time just to see what you can get.
Frequently asked questions
What is a good credit score?▾
On the FICO scale of 300 to 850, scores from 670 to 739 are considered good, 740 to 799 very good and 800 and up exceptional. Scores from 580 to 669 are fair, and below 580 is poor. Each lender sets its own standards.
How can I raise my credit score fast?▾
Pay down your credit card balances, ideally before the statement closing date, since card companies usually report the balance as of that date. Also dispute any mistakes on your reports. Late payments take longer to fade, so pay every bill on time from here on.
Does checking my credit score lower it?▾
No. Checking your own score or report is a soft inquiry and does not hurt your score. Only hard inquiries, which happen when you apply for credit, can lower it, and for most people one takes off fewer than five points.
How can I build credit with no credit history?▾
Start with a secured credit card, a credit builder loan from a credit union, or become an authorized user on a family member's card. Make sure the account reports to the credit bureaus, pay on time every month and keep the balance low.
Does applying for a payday loan hurt my credit score?▾
Applying with Cash in Flash will not affect your FICO Score. We may get information from a nontraditional consumer reporting agency, and that inquiry may affect your credit profile with that agency, but it will not impact your FICO Score.
Need cash while you build your credit?
Borrow $100 to $255 online with one flat fee shown before you sign, and repay it in one payment on your next payday. Applying will not affect your FICO Score, and if you are approved, money can arrive as soon as today.
