The emails usually come in the form of a slightly panicked plea, often from individuals who have just used Credit.com’s free Credit Report Card for the first time. They’ve seen something that they either didn’t expect or think is wrong, or they think their credit scores should be higher.
“How long will it take my credit report to be updated after I pay off a credit card/settle a collection account/get the IRS to remove a tax lien etc?” The writers of those emails will sometimes go on to explain that they are trying to get a mortgage, auto loan, or some other type of loan, and want to make sure their latest credit report information is considered.
So how often do credit reports change? Like so many things in life, your credit report can change in the blink of an eye.
“Right now it’s 11:40 my time,” said Rod Griffin, director of public relations for Experian, when I interviewed him for this story. “Let’s say a lender requested your credit report right now. If you apply for credit (again) in an hour your credit report could be different,” he says, referring to the inquiry that would have been generated when the first lender accessed my credit information.
“Credit reports can change as often as every day if there is new information provided to the credit bureaus,” says Barry Paperno, community director for Credit.com.
If you want to be technical about it, you don’t really have a credit report on file with the credit reporting agencies to begin with. Explains Griffin: “We have information from each of the lenders, and we go out to our databases and compile information from those databases when a credit report is requested. Your credit report represents a snapshot of your credit history at any given point in time.”
That means that the information is available in the credit reporting agencies’ (CRAs) databases at the time a credit report is requested is the information that will be reported. “You don’t have a credit report until you apply for credit and it’s requested,” Griffin says.
But it’s not like checking your online bank account and seeing the debit card purchase you made a few minutes ago in your running balance. “It’s not real time,” says Griffin.
While lenders often supply information to the CRAs on a daily basis, that doesn’t mean your account information is updated that frequently. “Lenders may have millions of customers and they don’t update all of their information at the same time,” Griffin points out. He goes onto add that many lenders report account information around the close of the customer’s billing cycle.
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But it’s not just information that is added to credit reports that cause them to change. Information also is removed or suppressed in the CRAs’ databases. Certain types of credit information must be removed when required under federal or state law, for example. “We’re also constantly tracking dates in case information needs to be removed because it’s too old. For example Chapter 13 bankruptcy will automatically be removed seven years from the filing date,” Griffin says. You don’t have to ask the CRAs to remove information that should no longer be report. It should happen automatically.
And just as credit reports can change at any time, so can credit scores. There’s a common perception that a “credit score is calculated, stored on a shelf somewhere, and changed periodically,” says Paperno. Instead, it is calculated when it is requested, based on the information from a CRA that is available at that time.
Does this change how you should view your credit report? Not really. You’ll still want to make sure you stay on top of your credit information so you can challenge mistakes if necessary. To do that:
Check your credit reports. At least once a year, visit AnnualCreditReport.com to get your reports and check that they are accurate and complete. (As we mentioned earlier, you can also get your credit score and a snapshot of your credit report using Credit.com’s free Credit Report Card.)
Give yourself time. Check your reports 3–6 months before applying for a major loan like a mortgage or auto loan, recommends Griffin. That will give you time for your credit report to be corrected and updated if you do find mistakes.
Be patient. It may take 30–45 days or so for updated information to appear on credit reports requested by you or a lender, due to the reporting process. If you’ve recently paid off a credit card with a high balance, for example, it may take a little time to see the lower balance reported.
[Free Resource: Check your credit score and report card for free with Credit.com]
Image: emma.kate, via Flickr
Gerri Detweiler Gerri Detweiler is Credit.com's Director of Consumer Education. She focuses on helping people understand their credit and debt, and writes about those issues, as well as financial legislation, budgeting, debt recovery and savings strategies. She is also the co-author of Debt Collection Answers: How to Use Debt Collection Laws to Protect Your Rights, and Reduce Stress: Real-Life Solutions for Solving Your Credit Crisis as well as host of TalkCreditRadio.com.
{ 45 comments… add a comment }
There is someone who currently lives at an address I used to live at for three months, nine years ago. He has the same first and last name as me, with a different middle name and obviously a different SS number and date of birth. Experian keeps picking up his bad credit and tax liens and assiging them to me. Trying to talk to anyone at Experian is impossible. I went through American Express Credit Aware and finally was able to talk to a customer service rep. She was little if any help. I have sent all the challenges to Experian and they have taken some of the info off, only to replace it with another tax lien and bad credit, because the do not cross reference the SS number and date of birth. What can I do? This has gone on for over a year.
get a job at experian, and screw up their creidt too!
First.. if you have already disputted these errors to the credit reporting agencies get yourself a good lawyer. One that specializes in the Fair credit reporting act.
Make sure you have back up like CERTIFIED copies of the disputes that you have filed with the credit reporting companies.
I have assisted my husband in a merged credit report for the last 7 years. Once they started taking away my husband’s GOOD credit we got a lawyer.
My best advise document document document and get a specialied lawyer.
The lawyer, if you have a case, should do it contingent on winning. From the sounds of it they may have violated some of your rights under the FCRA. (some pretty good reading to help you along) .
There are no lawyers who would take a FICO dispute on contingency. A contingency feel is used ONLY when money will be recovered. If you care about the score PAY to have the letters written.
Such a coincidence is impossible to believe; do you have any bridges for sale?
Well, believe it. I have inaccurate items on my credit report from the same first/last name and address as well.
I believe it, also. I have a friend who is a lawyer and had a client about 20 years ago who had the same name/DOB/very close SS# to someone who defaulted on an out-of-pocket open chest/heart surgery, and my friend’s client happen to have been admitted to this hospital 5 years before this not paid for surgery took place. Needless to say, credit report took a dive when a WELL into the 6-figure collection hit it.
It literally got to the point in court that his client had to open his shirt and prove his chest had never been cut open.
Silver lining – he got all fees and some restitution for cost incurred of having a 500 credit score until they got it all removed.
The credit companies report whatever is reported by the lender. You need to get after the lender only. Providing wrong information to the credit bureau is “LIBEL” and the remedies/penalties vary from state to state. You must have proper documentation available in order to pursue this matter.
Last year, I was in a similar situation. I myself drafted a legal letter after doing research for the applicable laws. My case was resolved with the consumer/lender within three days. Of course, I have a formal law degree. Sorry, I am not an attorney, since I have not yet taken the bar examination.
i have things on my credit report that are over 50 years old. these bills were paid in full years ago even when i was a poor family man and had to charge to provide for my family. why have they not removed these old charges from my account? i do not owe money to anyone. i pay all my credit cards in full each month. i only have normal monthly bills that are paid in full each month. my daughter has a higher credit rating than i do. she also pays all her credit cards in full each month, she doesn’t have any old outstanding bills that are even 5 years old. why does she have a higher credit rating? i am glad she does. i do not have to wait for experian or the others to approve any of my purchases. i pay in cash! so experian and the other two can go to hell.
“so experian and the other two can go to hell.” Amen!
It seems to me these credit reporting people either don’t know what they are doing or are in kahots with the government to screw the people!
Raymond Thomas it sounds like what is on your credit scores from the past are student loans. If you were delinquent on them, they may leave them that way. That happened to me and I had to send letters to have them change it once I paid it off. It takes work, but you can have this removed. It appears to be the only thing that remains on your credit report after the legal 7 years, when other stuff is removed with time.
Also, paying cash or charging only 10% of what you pay is the smartest way to keep your credit scores up. Credit companies want low balances below 33% of what your maximum is. And it allows you financial freedom, since you can usually pay off the balance, easily in poor economic times. I bought my car by putting 90% down and only financing 10% so that I balanced my credit. All my other cards have low balances. Cash is king in our house. Credit is only for financial standing.
Great Idea
Couldn’t agree more, Jennifer! I had, for years, fell into the family “trap” of using credit cards for all purchases, emergency money, etc. I read a great book called “Spent” that opened my eyes to all the psychology behind the use of money, an how our first impressions of money management can be so damaging if they are not good examples (mine weren’t). I clawed those credit debts down to zero and now practice a realistic savings plan so I have money to buy the things I want as well as an an emergency stash for bad days, but also keep using the credit cards sensibly (total utilization under 10%, paid in full every month) for credit-building purposes. It took some soul searching – and the realization that I am a good person because of who I am, not because of what I own or give.
Three or four years ago I did go to AnnualCreditReport.com. That did me absolutely NO good at all. I NEVER heard from them!! Don’t waste your time with them.
How strange. What happened? Did you request your reports but never received them? Did you ask for them by mail or online?
Huh? When you go to the AnnualCreditReport.come website and put all your information in, they direct you to the three reporting agency websites and you can print them off at that time.
A few years ago, when applying for a home loan, I was denied because of my questioned identity. Several institutions had entered the correct ssn, but spelled my first name (Lori) in different ways (Laurie, Lorry, and Lorna) and a couple had my last name incorrect as well. I asked the bank if any of them had bad credit – the answer was ALL of the versions of me had scored above 770, but I still had to jump thru hoops for 3 months to get approved….
I have leased a studio apt for 3 years. Is there a way to report to the credit agency my on time payment status to boost my credit score?
Unfortunately no. We wrote about that in this story: Can You Force a Bank to Report to Credit Reporting Agencies?
However, you may be able to use an alternative bureau like eCredable.com to help build credit with that information and other payments that aren’t reported.
Greg, there actually is an entity that tracks your rental performance. It’s a compiled score of your rental history plus your credit score. The last time I rented an apartment (about 10 years ago now because I bought my own place and no longer need to rent), I had to sign all kinds of permissions to allow the apartment managers to run this check (the credit check). I must have done pretty well on the scoring, because they literally rang my phone off the hook letting me know I could move in any time. While it’s not a boost to your credit score, per se, it is a boost to a score that means a lot when renting an apartment. That being said, it’s more important than ever to follow your lease agreement and try to get the full deposit back. Their keeping the deposit to fix anything you left broken or dirty behind will result in a “ding” on your rental score.
does closed several credit cards will that affect my credit score? and for how long? i kept only a few open. does it really matter if you only have one or two open to have good credit? i have good credit but i didnt want to have all the cards,,and paying all the high intreast rates were getting to be to much…..
i meant i closed several credit cards,,will that affect my credit score?
Hi Cindy,
I don’t blame you for closing those cards, especially if there were annual fees. When closing credit cards your overall credit utilization (balance/limit ratio) on all open cards, and any closed cards that still have a balance, will determine the impact to your score.
If your overall utilization is low – generally under 25% – there’s less potential damage to your score from closing cards than if your utilization is higher. It also depends on the extent to which any individual cards have high utilization.
If there’s any damage to your score from closing cards, the length of time it will take for your score to recover mostly depends on how long it takes you to pay those balances down and reduce your credit utilization. The faster you can reduce the credit utilization, the faster your score will recover.
Barry
thank-you barry for the info…i am in the process of paying those credit cards off…i only want one visa to keep my credit in check….thank you for responding …..cindy p
I was added as an authorized user on my fiancé’ credit card but it is not appearing on my credit.
Why?
Hi Anthony,
I’m assuming you’re trying to build or rebuild your credit, and want the benefit of this card on your credit report. There are a couple of possible reasons why that account isn’t showing up:
1) If it was just added recently, it make take a month or two to appear
2) Credit card issuers are not required to report the account for authorized users, so it may never appear on your credit report
My suggestion would be to contact the bank and first find out it it’s their policy to report on authorized users. If yes, ask them to start, or verify that it will be reported soon. If they don’t report, you may want to either be added to another or your fiance’s cards, if possible, or obtain a secured card that reports to the credit bureaus. Good luck!
-Barry
Yes a very good article. I was upset with my bank when they told me my credit score. i received my credit score earlier and it was a very decent score, but the bank said i was 4 points from getting an pre approved loan. I was hurt because i paid two cars off last year. My ex wife car and my truck. I know one part of the damage, but i am current on my bills. As a matter of fact i give each of my creditors 50 dollars more. So how can I boost up my credit score? To be honest it is wise to check your credit once or twice a year.
Hi Ernest,
It’s always a challenge to provide worthwhile information on how to raise your credit score without having more information available, but I’ll try. If by “part of the damage” you mean there were some late payments in the recent past, then just make sure everything remains current from here on out, and the negative impact from any late payments will lessen over time.
Also, if you have any credit card balances that amount to more than 25% of their credit limits, try to lower those balances as much as you can as soon as you can, leaving all accounts open. And lastly, hold off from applying for any more credit, unless you absolutely need to, as the inquiries from those applications can lower your score slightly.
-Barry
I have had my idenity stolen three times. And I found out that someone took out credit cards in my name. (I don’t use credit cards) When I called the company about the card I was told they would send papers to file fraud charges, but that never happens. They just wait for a few months and then try to collect on the cards again. How can you stop these people from using your information?
Henrietta – At a minimum you should place a fraud alert on your credit file. You may also want to consider a credit freeze. It’s a bit of a hassle but until this dies down it may be worth it. You’ll learn more in our story. What To Do If Your Wallet Is Stolen.
I have being working on my credit for almost 3 years and my credit scores are 64. I paid most of my bills on time and with experian kept the numers of scores 64. Can you help me understand what is wrong.
Thanks,
Rosa
Rosa – I am not aware of any credit scoring model that goes to 64. Would you mind checking your credit score through the Credit.com free Credit Report Card (it’s truly free) and then letting us know what that number is?
Thanks, Gerri Detweiler. Sorry, I meant my credit scoring are 645 and no changes since then.
Rosa – I don’t mean to be so vague but it’s so hard to know what’s going on with just the number. You do mention that you have paid most of your bills on time. Does that mean your credit report lists late payments within the past three years? If so, then that would very likely keep your scores down as late payments – especially those within last 24 months – affect your scores quite a bit.
I have had all my AMEX cards declined because of a disputed inflated hospital bill that was not paid by my health plan in 2007. I undestand that the claim will be dropped in 2014. Even with outstanding claim my score is 722 but is still affecting my credit card status even though my credit cards are paid automatically in full every month. My VISA limit was reduced and AMEX cards not recognized. We need to hammer FICA for not being more protective. WRITE YOUR CONGRESSMAN.
How long does a consumer propsal stay on my credit file? Is it as bad as bankruptcy.Since my creditors are being compensated somewhat does that make a difference?
Peter What do you mean by a “consumer proposal?” Are you in the US? If so, then a credit counseling DMP is not as bad for your credit as most people think. I wrote about that in this article: How Do Debt Relief Options Affect Your Credit? However if you are outside the US (which I suspect you are since that’s not a term we use here), I am afraid I don’t know the answer as I am not that familiar with the details of credit scores in other countries.
Be aware that the number you receive when you order your credit score from FICO may not be identical to the score your prospective lender receives. My wife and I recently bought a new car, co-applying for a loan through the manufacturers finance arm. We had used this lender to purchase new cars over the past 8 years, and kept a perfect payment history.
My FICO score was 732, my wife’s, 705. We easily qualified for the low interest loan promotion but the dealer’s business manager showed us that our Experian scores were 762 and 725, respectively. That was good news – but I wondered why. Then I read an article that explained different categories of lenders receive different scores, based on the type of loan applied for. In our case, automobile. I assumed that with our perfect payment record with this particular lender, our score was raised below our ‘average’.
Something to be aware of when applying for a loan of any type.
My husband and I recently had our credit pulled to see how much we had to improve our credit, he had an average score of 587 and I had an average score of 616 they told us we had to get our score to a 620, to pay off all our debt on our credit report it would lower our score a little and than raise it up within a few months. Well I paid them all off about a month ago and decided to check on freecreditreport.com and my scores have dropped between 50-91 points from paying them off and my husbands 0-38 points why does it drop and will it really raise within the next few months?
This is so frustrating…my husband and I paid off two huge credit cards (our last two), totaling $8,000. In the past 6 months we have paid off $30,000 in debt..and our credit scores actually dropped about 10 pts each!!!! What the heck??
Kimberly ……..I’m waiting on a reply to your question Lisa. Because I to just paid off some things on my credit report. I haven’t pulled it again to know if it dropped are raised . But I would like to know why your score dropped so much seems like you should have A1 credit now.
I had a pretty good credit score of 700 until recently. A collection was reported on 4/2013. I was shocked and did not know who or what the collection was about, so I filed a dispute with Equifax. It turned out to be a medical collection from 2009 that was paid off in 2010. It was my understanding that because I made payment arrangements and paid it off it would not be reported. So of course I forgot about it. Can a collection be reported for the first time 3 years later? It just doesn’t seem legal. Anyone know?
Rachel – If the collection is legitimate, they do have the right to report and there’s no law that says the can’t, unfortunately. The same holds true for when they choose to report.