Frequently Asked Questions (FAQs)
Here are answers to some common questions about credit scores and financial health.
How quickly can I improve my credit score?
The time it takes to improve your credit score depends entirely on what is negatively affecting it. If your score is low due to high credit utilization, you can see a significant improvement in as little as 30-60 days simply by paying down your balances. However, if your score is being hurt by more serious issues like late payments, collections, or bankruptcy, recovery will take much longer. Negative marks like these can stay on your report for seven years or more. The best strategy for improvement is consistent, responsible behavior over time: paying every bill on time and keeping balances low.
Does checking my own credit score hurt it?
No, checking your own credit score or pulling your own credit report never hurts your score. When you check your own credit, it is known as a “soft inquiry” or “soft pull.” Lenders cannot see these inquiries. Hard inquiries, which can affect your score, only occur when a potential lender checks your credit as part of an application for new credit. It is a very good habit to check your score and reports regularly through free services offered by your bank or credit card company, or via the official annual report website.
Is it better to have one credit card or multiple credit cards?
There is no perfect number of credit cards. However, from a credit scoring perspective, having a few cards (e.g., two to four) that you manage responsibly is generally better than having just one, or having a very large number of cards. Having multiple cards can help your score by improving your credit mix and making it easier to maintain a low overall credit utilization ratio. The key is to only have as many as you can manage responsibly, always paying them on time and in full whenever possible.
Will paying off a collection account remove it from my credit report?
Not automatically. When you pay a collection account, its status on your credit report will be updated to “paid” or “settled.” A paid collection is much better for your score than an unpaid one, but the record of the collection itself will typically remain on your report for up to seven years from the date the original account first became delinquent. Some newer scoring models, like FICO 9 and VantageScore 3.0 and 4.0, ignore paid collection accounts, but many lenders (especially in the mortgage industry) still use older models that do not. Before paying a collection, you can try to negotiate a “pay for delete” agreement with the collection agency, where they agree to remove the entire entry from your report in exchange for payment, but be sure to get this agreement in writing.
What is considered a “good” credit score?
Credit score ranges can vary slightly between different scoring models, but using the common FICO Score 8 model, the ranges are generally understood as follows:
- Exceptional: 800 – 850
- Very Good: 740 – 799
- Good: 670 – 739
- Fair: 580 – 669
- Poor: 300 – 579
Lenders often consider a score of 670 or higher to be a sign of a reliable borrower, but you will typically need a score in the “Very Good” or “Exceptional” range to qualify for the very best interest rates and loan terms.
