If I have an average credit score of 500 and wish to increase it to 700+ how long would it take?

Question

also what are some things I can do?

Answer 1

It really depends on why your score it 500. If you have things that are reported incorrectly then those can be fixed or deleted which will help increase if faster but you are probably looking at 6-12 months maybe longer. Here is a some info for you.


Credit Scoring Basics

What is a Credit Score?

A credit score is a number generated by a mathematical formula that is meant to predict credit worthiness. The most common of the credit score standards is the FICO score by Fair Isaac. The FICO score ranges from 350-850 and is intended as a predictor of whether or not you will be 90 days late on a loan obligation. Fair Isaac uses thousands of credit reports to calibrate the FICO scoring model and is very secretive of the exact formula.

Here is a percentage breakdown of a FICO score:

35% - Payment History
30% - Debt Ratio
15% - Length of Credit History
10% - Types of Credit
10% - Number of Credit Inquiries

Most people are aware of the three credit reporting agencies TransUnion, Equifax and Experian. The average difference in score between the highest and lowest of your three FICO scores is 60 points. This is the result of each of the credit bureaus having different items on their report. some correct, some incorrect and some that are not being reported in full compliance with credit law.

According to the Government Accountability Office, 80-90% of credit reports have serious errors on them, How can I get a free copy of my credit report? By law, all consumers are entitled to a free copy of their credit report from each of the three credit bureaus once a year. Visit annualcreditreport.com to get yours for FREE. (This is for the credit report only and does not include the credit score.)

How long will the items get reported on my file?

Delinquencies (30–180 days): Can remain seven years from the date of the initial missed payment.

Collection accounts: Remain seven years from the date of the initial missed payment that led to the collection (the original delinquency date). When a collection account is paid in full, it will be marked "paid collection" on the credit report.

Charged-off accounts: Remain seven years from the date of the initial missed payment that led to the charge-off (the original delinquency date), even if payments are later made on the charged-off account.

Closed accounts: Closed accounts are accounts that are no longer available for further use. Closed accounts may or may not have a zero balance. Closed accounts with delinquencies remain seven years from the date they are reported closed, whether closed by the creditor or by the consumer, but the delinquency notation will be removed seven years after the delinquency occurred when pertaining to late payments. Positive closed accounts remain ten years from the closing date.

Lost credit card: If there are no delinquencies, credit cards that are reported lost will continue to be listed for two years from the date the card is reported lost. Delinquent payments that occurred before the card was lost are reported for seven years.

Bankruptcy: Chapters 7, 11, and 12 remain for ten years from the filing date. Chapter 13 remains seven years from the filing date. Accounts included in bankruptcy will remain seven years from the date they were reported as included in the bankruptcy.

Judgments: Remain seven years from the date the judgment is filed.

City, county, state, and federal tax liens: Unpaid tax liens remain fifteen years from the filing date. Paid tax liens remain seven years from the paid date of the lien.

Inquiries: Most inquiries listed on your credit report will remain for two years. All inquiries must remain for a minimum of one year from the date the inquiry was made. Some inquiries, such as employment or pre-approved offers of credit, will show only on a personal credit report pulled by you.

Is there anything that cannot be in my credit report?
Certain information cannot be in a credit report, including:

Medical information (unless you give your consent)
Notice of bankruptcy (Chapter 11) that is more than ten years old Debts (including delinquent child support payments) that are more than seven years old Age, marital status, or race (if the request is from a current or prospective employer

Answer 2

The big thing is HOW MUCH debt are we talking? Are you talking about 80+% debt to available credit ratio? Lots of lates/chargeoffs? I'm just trying to figure out why the score is 500. There are ways of getting this up 50-100+points in a matter of months, thereby qualifying you for some decent rates. The last thing you want to do is have "a lot of debt" and take on another debt at a high interest rate If you're near 80%, then you have two things you can do. A: Pay off the highest interest rates first, and B: Pay off the card with the highest balance to available credit ratios. Getting each individual card under 50% is good, under 30% is ideal. Reducing the %age of debt to credit will help the score. Paying off the higher interest debt will help the pocket (And the score, but not as much) A little description of the debt might help. If not, then hopefully my advice above will help.

Answer 3

First you need to obtain a copy of each of your credit bureau's. It is law that you receive a free copy one time per year from each of the 3 agencies. Go to Equifax.com, TransUnion.com and Experian.com to get them. Then look at any negatives or derogatories that are on your credit such as collections. Pay them off...and remember that you can negotiate with collection agencies. It is possible to pay pennies on the dollar...but make sure that they put paid in full on your credit or take it off. Don't let them tell you they can't.
Also pay attention to your existing credit cards, installment loans, and mortgages. Make sure you pay everything on time...late fees suck and missed payments affect your scores a lot. Also make sure to watch your credit balances....you never want to go over 50% of your limit. Pay one or two cards off completely and keep your other balances under 50%. Available credit either helps or hurts you...Do not cancel your cards after you pay them off!!! Doesn't help you at all.
It will take a while to increase your score...on time payments for a year or two will help a lot. Be patient and also be proactive...you can check your scores on sites like myfico.com...and they have dispute letters available...but it costs money...if you want to do it for free, just research it on the net.

GOOD LUCK!

Answer 4

Get a credit card and pay off everything you buy on time. It'll go up eventually.