And are there benefits to knowing how often your credit report is updated?
So Let’s say you are preparing to apply for a new mortgage.
To boost your chances of getting approved, you take some credit boosting actions like paying your bills on time, reducing your credit utilization, etc.
Unfortunately, you check your score, and you don’t notice any difference at all.
None of your recent credit score boosting activities have been reflected in your credit report.
The above situation is very common.
And it can be very frustrating to watch your credit score remain the same when you have been actively trying to boost it.
The problem, in this case, is usually down to how often is your credit report updated.
And how often your credit reports are updated depends on a set of factors that involve you, your lenders, the credit bureaus, and the credit scoring model.
When you know how often your credit reports are updated, you can make smarter financial decisions, especially for taking new credit and loans.
You’ll also stay up to date on all the information that goes into your credit report.
Today, we’re looking to understand how often your credit reports are updated.
And to do that, we’ll be looking at the following:
- What is a credit report update?
- How often your credit reports are updated?
- How to check how often your credit reports are updated?
- Benefits of knowing how often your credit reports are updated.
- How to prevent negative credit score updates?
- What Is a Rapid Re-scoring?
What Is A Credit Report Update
Your credit report forms your credit score.
Your credit report is based on a set of information about you.
While all the information collected on your credit report is important, not all of them are used to calculate your credit score.
The most important information in your credit report that is used to calculate your credit score include:
- Payment history – This is the record of all your payments, including on-time payments, late payments, missed payments, defaults, charged-off debts, etc.
- Credit utilization rate – This is how much credit you are using compared to how much credit is available to you.
- Credit inquiries – This includes both hard inquiries and soft inquiries. Hard inquiries, stay on your credit report for as long as 2 years.
- Status of your accounts – This shows the status of all your credit accounts, including open, closed, charged-off, foreclosures, refinanced accounts, etc.
- Past and present creditors – This is the list and the dates of all the creditors you’ve worked with. Both in the past and the present.
- Credit limits – This refers to the limit on your revolving accounts and also the limits on your fixed installment accounts.
- Open and close dates of all your accounts – This refers to the dates you opened and closed all the credit accounts in your portfolio.
A credit report update happens when one or more of the following information changes.
For example, if you suddenly get several hard inquiries in a short time, then your credit information gets updated.
Most times, how often the information listed above changes directly affects how often your credit reports are updated.
While you aren’t always in control, you can manage how often your credit reports are updated by making on-time payments and keeping your credit utilization low.
Please note that errors can show up in any of the above sections of your credit report.
And depending on the error, your credit score might take a serious hit.
Therefore it’s important to know how often your credit reports are updated so you know when to check your credit reports and also if errors have shown up in your credit report.
How Often Is Your Credit Report Updated?
How often your credit reports are updated depends on several factors.
Credit reports might get updated as many as several times during the day, or as little as once a month.
However, credit reports are usually updated per week or per day.
Now, after knowing what causes your credit reports to be updated, you will want to know how often your credit report is updated.
Like we said earlier, most times, you aren’t in control of how often your credit reports are updated.
However, you can understand the major factors that affect how often your credit reports are updated and use that information to guide your financial decisions, and also use that information to maintain a good credit score.
Here is a breakdown of the factors that affect how often your credit reports are updated:
- When the lender supplied the information to the credit bureau – This is one of the major factors that affect how often your credit reports are updated.
Creditors aren’t obliged to update the details of your credit activity within a particular time frame.
However, most lenders will update your credit activity with the credit bureaus within 30–45 days.
- Which credit bureau provides your credit report – While some lenders report to all the credit bureaus, some report to one or two credit bureaus.
So the credit bureau you lender reports to determines how often your credit reports are updated.
- Which credit rating system is used – The two major credit rating systems include FICO Score and VantageScore.
Plus, the individual credit rating systems have different rating systems, e.g. FICO 8 Score, FICO 9, VantageScore 3.0, VantageScore 4.0.
So, in your financial life, how often your credit reports are updated depends on the particular rating system being used to create your credit report.
Please note that most lenders use the FICO rating system.
- The type of credit score you have – You might use a specialty score, e.g. for auto insurance, car loans, etc.
How often your credit reports are updated if you are using a specialty score would most likely differ from those who are using a regular score.
- Your recent credit activity – Your recent credit activity also affects how often your credit reports are updated in your financial portfolio.
Some credit activities are more important than others in determining how often your credit reports are updated.
For example, hard inquiries, bankruptcies, and collections are going to cause a major update to your credit report.
How To Know When Reports Are Updated
The best way to know how often your credit reports are updated is by checking your credit reports regularly.
People are advised to check their credit reports once a year.
If you want to stay on top of how often your credit reports are updated, then you can’t afford to check your credit reports only once a year.
Checking your credit reports regularly has several benefits apart from keeping you in the know of how often your credit reports are updated.
You can check how often your credit reports are updated by checking your credit reports every week.
You can request weekly access to your credit report from the three credit bureaus by going to AnnualCreditReport.com.
Benefits of knowing how often is your credit report updated
Checking how often your credit reports are updated means you would read your credit reports frequently.
You might wonder whether there are any benefits to going through the stress of checking how often your credit reports are updated.
Here are some benefits of regularly checking how often your credit reports are updated.
Regularly checking how often is your credit report updated helps you understand how your credit score is calculated.
It also helps you understand the major factors that affect your credit score, and this can help you make smarter financial decisions.
E.g. If you check your credit report regularly, when you notice a major drop in your score, you can then check your recent credit activity and know what caused the drop.
You can then know the actions you can take to prevent further drops in your credit score.
Knowing how often your credit reports are updated can help you know the best time to apply for a loan.
Checking your credit report regularly shows you not only how often your credit reports are updated, but also whether you are in an excellent position for a loan.
E.g. Applying for new loans within a short time can reduce your credit score, however, when you regularly check your credit report, you can know whether your recent credit activity has been added to your credit report and whether applying for a new loan would be a good choice.
Helps you stay on top of errors;
Errors end up in credit reports and the error could be a fault of you, your lender, credit reporting agency, etc.
And the only way to stay on top of errors is to check your credit reports regularly. I.e. weekly, monthly, etc.
And that also means that you’ll know how often your credit reports are updated.
Helps you watch out for identity theft and other fraudulent activities;
Fraudsters and identity thieves can get hold of your accounts and they can use it to apply for loans in your name.
Fortunately, if you are constantly aware of how often your credit reports are updated in your portfolio, then you can spot signs of fraudulent activity like mysterious hard inquiries.
Can motivate you to build a good credit score.
Building a healthy credit score and maintaining a good credit score is often a matter of years.
And while you’re putting in the work and the discipline, it’s demotivating to feel you’re not making any progress.
However, knowing how often your credit reports are updated can show you when to check, if only to get a motivational boost on your journey towards a healthy credit score.
How To Prevent Negative Credit Score Updates?
Once you monitor how often your credit reports are updated, you notice how negative information affects your credit reports.
And it is also important that you know how to prevent negative information from getting into your credit reports.
The following are some tips you can use to make sure that negative information doesn’t hurt your credit score.
- Pay all your bills on time – Your payment history contributes as much as 35% to your credit score.
And just one missed payment would likely remain on your credit report for 7 years.
So you have to make all bill payments on time so your credit score doesn’t suffer.
- Dispute all errors – Go through your credit report thoroughly and make sure you dispute any errors you find.
You don’t want to get turned down for a loan because of an error you didn’t correct.
- Keep Your Credit Utilization Low – Keeping your credit utilization ratio below 15% is a sure way to boost your credit score.
What is Rapid Re-scoring?
Rapid re-scoring is a technique used to boost your credit score to prepare for a loan or mortgage.
It is used in situations where your credit score is close to the lender’s requirement, but it’s still not enough to get you approved for the loan.
Rapid re-score gives both you and the lender the most recent update of your credit report and it could be a helpful way to qualify for a loan.
Rapid re-score can also help you when you have proof of an error in your credit report and you need that error removed immediately.
Please note the following about a rapid re-score.
- You can’t request a rapid re-score by yourself
- Only a lender can make a rapid re-score. However, you can discuss it with a potential lender.
- There’s a fee for requesting a rapid re-score
- A rapid re-score can’t remove negative information
Credit scores are constantly changing due to how often information is being added and removed from your credit score.
Plus, the information and the credit bureau rating metric also affect how often your credit reports are updated.
Thankfully, this guide cuts out all the confusion involved and makes it straightforward to understand how is your credit report updated.