How Long Does it Take to Build Credit?

It takes at least six months to generate your first credit score. If you’re improving an existing score, you may see changes in 30 to 45 days. Rebuilding damaged credit can take a few months to several years depending on your starting point.

A stronger credit score can open the door to better interest rates on loans and credit cards. It can also make it easier to achieve major milestones like renting an apartment or buying a car.

Here’s what you need to know about building credit at different starting points.

How long does it take to build credit from nothing?

If you’re starting from scratch, it will take at least six months to generate your first FICO credit score. Getting approved for a loan or an unsecured credit card is difficult when you don’t have a credit history.

Lenders look at your payment history to determine how dependable a borrower you may be. If you have no credit history, they can’t anticipate your ability to use credit responsibly and pay your bills on time.

Fortunately, there are alternative ways to build credit.

How to build your credit from scratch

When you’re just starting your credit-building journey, these strategies can help.

• Get a secured credit card: Secured credit cards act just like regular credit cards, but you pay a security deposit upfront. This deposit acts as collateral – a form of security for the lender in case you can’t pay – and it also sets your credit limit. These cards often come with more lenient requirements and are more accessible to first-time credit builders. However, they may also have a high annual percentage rate, or APR. To avoid interest charges, pay your bill on time and in full every month.
• Get a credit builder loan: If you want to build credit without a credit card, you can use a credit-builder loan to create a history of on-time payments. They’re different from traditional loans because you’re essentially repaying a loan to build credit. You don’t get the loan’s proceeds until you repay it in full. Check out your local credit unions and community banks for this type of loan.
• Become an authorized user: Ask a trusted friend or family member with good credit to add you as an authorized user on their credit card account. Your credit score could improve if they make on-time payments.
• Boost your credit with rent and utility payments: Some property managers and utility companies report your on-time payments to credit agencies. Check with yours to see if you can use a positive payment history to improve your credit. Alternatively, sign up for a service that will report your rent and utility payments to the credit bureaus.

Why don’t I have a credit score?

You need at least one active credit account for six months before most scoring models can generate a score. Credit bureaus require enough payment history to assess your creditworthiness.

If you’ve never had a loan or credit card reported to the bureaus, you may be “credit invisible” – but opening a credit account and using it responsibly will start building your score.

How long does it take to improve your credit score?

You could start seeing changes in as little as 30 to 45 days when you improve your score through consistent habits. Pay your bills on time, reduce debt, and keep your balances low for the biggest impact. Stay consistent with these actions and your score will grow steadily over time.

How long does it take to rebuild a damaged credit score?

Repairing damaged credit can take anywhere from a few months to a couple of years depending on the severity of the damage. Stop the behaviors that hurt your score and focus on paying down high-interest debt and making on-time payments. You’ll need several months of responsible credit use before you’ll see significant improvements.

Most lenders use your FICO Score, which considers five key factors in its calculation:

1. Payment history (35%): Reflects your track record of paying bills on time
2. Credit utilization (30%): How much available credit you’re using
3. Length of credit history (15%): How long you’ve been building credit
4. Credit mix (10%): The mix of different types of credit accounts you have
5. New credit (10%): The number of credit accounts you have recently opened

Your payment history and credit utilization are the most important factors that make up your credit score. Consistently paying bills on time and using credit sparingly can help you improve it.

Credit scoring companies like FICO and VantageScore have scores ranging from 300 to 850. Major credit bureaus and lenders consider a score of 579 or below as poor credit, while they see 800 and above as excellent credit.

Chime Tip: Consider setting up auto-pay with your bank, credit card issuer, or loan servicer so you don’t miss any bills. Using auto-pay can help you avoid accidental late payments that could damage your credit score and lead to late fees.

Just make sure to keep enough money in your account so the automatic payments go through successfully.

You can speed up your credit-building progress by focusing on these key factors:

• Payment history: Paying bills on time is the most important factor for your credit score. The longer you make on-time payments, the faster your score will improve. Set up automatic payment plans to stay on top of due dates.
• Credit utilization: Try to keep your credit usage under 30% of your limit. A high credit utilization ratio – the percentage of your available credit that you’re using – can hurt your score, but keeping this number low can help your score grow more quickly.
• Credit age: The longer your account is in your credit file, the better it is for your score. While you can’t speed up the aging process, keeping old accounts open will help your score improve over time. You might consider cutting up an old credit card if you’re tempted to overspend, but it’s often a good idea to leave the account open. You may need to make small charges now and then so your account doesn’t become inactive.
• Hard inquiries: Hard inquiries can lower your score. Applying for many new credit accounts in a short time can slow your progress. Space out hard credit inquiries to avoid this issue.
• Credit limits: You can improve your score by requesting periodic credit limit increases. This can lower your overall credit utilization, as long as you don’t overspend. You may want to space these requests out, as they often result in a hard inquiry – an official credit check that can temporarily lower your score.
• Credit report errors: Review your credit report for inaccuracies. If you spot any errors, file an official dispute to try to have them removed.

Stay consistent with these habits, and your score will steadily improve over time.

Building credit depends on your starting point and ability to maintain smart habits. Check your credit score regularly, stay consistent, and celebrate every score increase along the way.

Ready for more guidance? Learn how to build credit fast for beginners.