Have you been checking your credit score every day to see if there are any changes? Most people do this when they are planning on applying for a loan or mortgage. They hope their score would have improved at least a little bit so they can get a lower interest rate on their loan.
If you’ve been working towards improving your score, naturally you want to make sure it has updated before submitting your loan application. But checking everyday can be frustrating, especially when you don’t see any change. Knowing how often your credit score is updated can help save you time and reduce your frustration.
Your credit score is essentially a snapshot of your loan and credit activity. When you make a loan or credit card payment, it gets reported to the three major credit reporting agencies. Your score is then updated to reflect the latest activity. However, this does not happen instantly.
Each creditor has their own schedule for sending reports to the bureaus. Most creditors report to the bureaus every 30 to 45 days but they seldom send reports to all three bureaus at the same time. They may send a report to Equifax one week, Experian the next week, and TransUnion the third week.
The credit bureaus have their own schedule for updating the information. Each of the credit bureaus will first check that the information is accurate. This could take from a few hours to several days. If the data checks out, your credit score is updated. If something appears amiss, the bureau will take steps to double-check the information and verify that it is correct. Only then will they update your credit score. This can lead to a delay in your report being updated.
All the loan and credit payments you’ve made for that month will be included in the report with details on whether or not the payments were made on time. The report also contains information regarding changes in your credit card balances and your total outstanding debt. If you applied for a loan or new credit card, that information will also be included.
The fact is credit scores don’t stay the same for long but neither do they update continuously. They only get updated when your creditor sends some information to the credit bureau.
If you have one financial product, your credit report will get updated once a month. If you have multiple financial products, your report will get refreshed more frequently. Every time data gets added to your credit report, it generates a new credit score. Whether your score increases or decreases depends on the data that is added.
If your payments are made on time, you can expect to see an increase in your credit score. If a missed payment gets reported, you can expect your credit score to lose a few points.
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