How to Raise My Credit Score 40 Points Fast

Key Takeaways

• Boosting your score 40 points quickly could have a dramatic impact on your finances.
• Most credit score progress begins to show up after a month, but it may take longer than that to increase your credit score further.
• You need to commit to positive habits to ensure your credit score increase isn’t temporary.

8 Tips to Boost Your Credit 40+ Points 

Raising your credit score fast can be accomplished in more than one way, and you could even try several different strategies at once. We suggest the following eight tips to get you on the path to good credit quickly.

1. Apply for a New Credit Card 

• Time commitment: One hour per month at most to track your spending and make your credit card payment
• Cost: This move can be free if you pay your balance in full each month
• Risk: Medium

While you may think a new credit card is the last thing you need when you're trying to boost your credit, you may be surprised to find out just how much a new card can help. First, getting a new credit card will increase your available credit and lower your utilization credit overnight, and this is the second most important factor that makes up your FICO score at 30%. In the meantime, getting a new credit card can also improve your credit mix (the mix of types of credit you have), and this factor makes up another 10% of your FICO score.

Just keep in mind that you may have to get started with credit cards for bad credit or a secured credit card that requires a cash deposit depending on where you're starting at. However, there are many credit cards for credit building that offer rewards with no annual fee, and secured cards that require collateral often let you begin the process with as little as $49 to $200 down.

Also note that you can hurt your credit if you get a new card and don't use it responsibly. To make the most of this tip, you'll want to use your new card for small purchases and pay it off on time every month. At the very least, you should strive to pay on time and keep your new balance as low as you possibly can (ideally below 30% of your available credit).

Pros and Cons of Getting a New Credit Card

2. Pay Down Your Credit Card Debt

Time commitment: Can take several months or even years

Cost: This move will actually save you money in the long run

Risk: None

Impact: Paying down debt lowers your credit utilization ratio and improves your payment history

Finimpact score: 5 (rated on a scale of 1 to 5 with 5 being most important)

If you have debts on various credit cards or several loan payments to make each month, taking steps to pay these amounts down can help you in more ways than one. Not only can paying down debt lower your credit utilization ratio, but it can help you save significant sums of money on interest, too.

The impact of paying off debt can be even greater if you owe too much at any given time. Most experts suggest keeping your credit utilization ratio under 30% for the best results, which means never owing more than $1,000 for every $3,000 in available credit you have. Of course, getting your credit utilization even lower than that can be even better for your credit score.

In the meantime, getting into debt repayment mode and making all your payments on time can help you build credit and boost your score even faster. 

Pros and Cons of Paying Off Credit Card Debt

3. Apply for a Credit-Builder Loan

Time commitment: Usually 12 months or longer

Cost: This can cost you $100 or more, depending on the loan

Risk: Medium

Impact: Credit-builder loans let you build credit when you have none

Finimpact score: 5 (rated on a scale of 1 to 5 with 5 being most important)

If you have minimal credit history or no credit history at all, your two main options for getting started are secured credit cards and credit-builder loans. With credit-builder loans, you make payments toward a savings account in your name, except the loan company reports them to the three credit bureaus as if you were making a real loan payment. At the end of the process, you get the money from the savings account in your name repaid to you, minus interest charges and fees.

This move can help you accomplish multiple goals since it adds to your payment history, lets you prove creditworthiness with on-time payments, and adds to your credit mix all at once. If you opt for a credit-builder loan, you should make sure you understand the total fees and charges upfront. 

It helps to work with companies in this space who are transparent about their pricing. As an example, a company called Self is very good about explaining all costs upfront. On their website, you can easily see that a credit-builder loan with a $25 monthly payment for 24 months would have you paying in $600 and getting back $520 after the loan term ended.

Pros and Cons of Getting a Credit-Builder Loan

4. Catch Up On Past-Due Accounts

Time commitment: Varies

Cost: Varies

Risk: None

Impact: Getting payments out of default can dramatically impact your credit

Finimpact score: 5 (rated on a scale of 1 to 5 with 5 being most important)

Credit accounts in default will stay on your credit reports for seven years whether you remedy the situation or not. Once you are late enough on your bills, your credit accounts can also be sent to a collection agency, which may try to come after you to collect the debt for up to 20 years.

Fortunately, you can get on the path to improving your credit and stopping harassing phone calls if you work toward resolving past due debts. You can do this by calling your creditor or the collection agency to negotiate a cash payment, or by beginning to make monthly payments toward the defaulted debt. Equifax notes that, even with debts in default, beginning to make on-time payments again and lowering the balances over time will help improve your credit score. 

Pros and Cons of Catching Up On Past-Due Debts

5. Find and Dispute Credit Report Errors

Time commitment: Varies

Cost: Free

Risk: None

Impact: Fixing credit report errors can dramatically impact your score

Finimpact score: 5 (rated on a scale of 1 to 5 with 5 being most important)

If there are reporting errors on your credit reports with Experian, Equifax, or TransUnion, these errors could be dragging down your score without you even knowing it. The Consumer Financial Protection Report (CFPB) says that common errors that could be impacting your score could include accounts belonging to another person, duplicate accounts, falsely reported late payments, incorrect balances and more.

To find out if you have errors on your credit reports, you'll want to check your reports for free at AnnualCreditReport.com. If you find anything that seems incorrect, including accounts that aren't even yours, you'll want to dispute this information with each of the credit bureaus and the companies reporting the false information via written communication. If you can get something like a false late payment or duplicate account removed, quickly raising credit score becomes a real possibility.

Wondering how to execute this step? The Federal Trade Commission (FTC) offers an excellent resource that explains exactly how to dispute errors on your credit reports. 

Pros and Cons of Disputing Errors On Credit Reports

6. Add On-Time Payments to Your Credit Report 

Time commitment: One hour or less in set-up time

Cost: Can be free, although some services charge a fee

Risk: None

Impact: Adding depth to your credit reports can increase credit score progress

Finimpact score: 4 (rated on a scale of 1 to 5 with 5 being most important)

If you don't have a credit card or a loan in your name, getting on-time payments to show up on your credit reports can be a challenge. Fortunately, several apps and companies are ready to help you in this area, some of which are free to use.

For example, Experian Boost is a free app that lets you get credit on your Experian credit report for utility bills you pay, subscription services you use, and even rent. From there, profit-based companies like RentReporters and Rent Kharma report your rent payments to the credit bureaus in exchange for fees.

While using Experian Boost is a no-brainer since it's free, you'll want to consider whether you want to pay a fee to get credit for rent — and how much that fee is. For example, Rental Kharma lets you get credit for all your past rent payments for $75, which is a pretty good deal overall. You can also pay for ongoing rent reporting for $8.95 per month.

Pros and Cons of Getting On-Time Payments Added to Your Credit Reports

7. Ask to Become an Authorized Credit Card User 

Time commitment: Minimal time commitment

Cost: As little as $0

Risk: High

Impact: Adding depth to your credit profile is extremely important

Finimpact score: 4 (rated on a scale of 1 to 5 with 5 being most important)

If you have a trusted family member or friend who has great credit, asking them to become an authorized user on their credit card can help you improve credit. The best part is, they don't even have to give you the card they get in the mail with your name on it. By piggybacking on their credit as an authorized user, you can get credit for on-time payments and improve your credit mix whether you actually have access to the card or not.

That said, late payments on the card could negatively impact your score even though you aren’t responsible for making the payments. Not only that, but you can get into some uncomfortable situations if the primary cardholder gives you your credit card and you use it for purchases you don't pay them back for.

This step should only be tried with someone you really trust and who trusts you in return. However, becoming an authorized user can work well when everyone is on the same page and dedicated to helping you build credit.

Pros and Cons of Becoming an Authorized User

8. Keep Your Oldest Accounts Open

Time commitment: None

Cost: Free

Risk: Minimal

Impact: This improves the average length of your credit history

Finimpact score: 4 (rated on a scale of 1 to 5 with 5 being most important)

According to myFICO.com, the average length of your credit history makes up 15% of your FICO credit score. This means that, if you're looking for the fastest way to boost credit score progress, keeping old accounts open definitely makes sense.

This tip mostly applies to revolving credit lines you have that you may not be using, such as old credit cards that don't offer rewards. In this case, you can stash the card away in a drawer or a safe for the long run and it will still help your credit score whether you use it or not. Conversely, closing old accounts decreases the average age of your credit history, which is not good for your score. Closing old cards can also hurt your score by lowering your available credit, thus increasing your credit utilization ratio. 

If you have an old credit card with an annual fee, you may want to ask your card issuer about downgrading it to a no-fee version. This would help you maintain the same credit line without having to pay for the privilege each year.

Pros and Cons of Keeping Old Accounts Open

How Fast Can Credit Scores Go Up?

If you've been looking up terms like "boost credit scores fast" and "boost credit score overnight," you might be disappointed to know that credit score progress always takes time. This is mostly due to the fact lenders and other creditors only report your information to the credit bureaus monthly, and that the credit bureaus themselves only update credit scores around once per month.

This means that raising your credit score fast typically requires at least 30 to 45 days of patience. However, it's possible to see considerable progress within a few months if you take several steps we outlined in this guide. You could even wind up raising your credit score 40 points or more over that timeline.

How to Avoid Hurting Your Credit 

Several common pitfalls can lower your credit score in a hurry, and that's true whether you've been taking steps to boost your credit score fast or not. Here are some of the most common things you'll want to avoid, plus why:

• Late payments: Because your payment history makes up 35% of your FICO score, avoiding late payments is one of the best ways to boost credit score fast.
• Applying for too many credit cards: Each new credit card you get results in a hard inquiry on your credit reports, and too many at once can cause your score to drop in the short-term.
• Maxing out your credit cards: Maxing out credit cards gives you a high credit utilization ratio, which is bad since this is the second most important factor that makes up your FICO score at 30%.
• Ignoring debt: Never ignore debt and always remember that it won't go away on its own. If you can take steps to get on track with your payments, your credit score could increase quickly.
• Closing your oldest accounts: Old accounts can help your credit score whether you use them or not, so don't close them for no reason.

Building Your Credit from Scratch 

When you don't have any credit history to speak of, you should know that it can take at least six months to get a credit score. During that time, what you do and don't do for your credit ultimately determines where your first credit score will land.

That said, it is often easier to build credit from scratch than to repair damaged credit. You might even see a 40 point jump faster when you are initially building out your credit profile. 

If you are hoping to build credit from scratch, however, it is often difficult to find someone to give you your first account. Ultimately, that's where secured credit cards and credit-builder loans come into play since these financial products build credit and approve almost anyone.

Repairing Your Credit 

While the tips we offered in this guide can help you build credit or boost your score by 40 points quickly, the exact steps can also be used to repair credit after you have made some mistakes. If you have a history of late payments on your credit reports or you once ignored a debt completely for several months, making all the moves we suggested can help you get on the path back to good credit over time.

Repairing credit takes time and patience. However, getting started now means you can see results faster than if you wait.

Monitor Your Credit 

Whether you have bad credit, fair credit or a great credit score, you'll want to keep tabs on it and monitor your progress over time. This step can help you stay motivated when it comes to maintaining good credit or improving credit, and it can also help you find out if a reporting error made it on your credit reports.

If you have been using credit responsibly but your credit score drops in a hurry, this could even be a sign of identity theft. The following tips can help you watch your credit and score over time:

• Check each of your credit reports with Experian, Equifax and TransUnion at least a few times per year using the website Annual Credit Report.com.
• Look into credit monitoring services offered by Equifax, Experian, and TransUnion, which keep tabs on your credit for free or for a fee.
• Some credit card issuers like Discover and Bank of America may offer a free look at your credit score each month.
• Other free services like Credit Karma or Credit Sesame let you monitor your credit score over time without paying for it.

Why Having a Good Credit Score Matters

Having a good credit score can help you qualify for the best rates and terms any time you borrow money, but it can also help you land a job or score lower insurance rates. Good credit can also help you get better mortgage offers and higher credit limits, and you may even be able to qualify for the best rewards credit cards and travel credit cards.

But, what does a "good" credit score really look like? Here's a rundown of how good credit looks with both the FICO scoring model and with VantageScore:

FICO credit score rankings:

• 300 to 580: Poor
• 580 to 669:  Fair
• 670 to 739: Good
• 740 to 799: Very good
• 800 to 850: Exceptional 

VantageScore rankings:

• 300 to 499: Very poor
• 500 to 600: Poor
• 601 to 660: Fair
• 661 to 780: Good
• 781 to 850: Excellent 

Final Word

If you've been wondering how to raise my credit score 40 points fast and you read through this entire guide, you should have a good idea of the steps you need to take to reach your goal. For the most part, you'll want to pay bills on time, pay down unsecured debts and look over all your credit reports to check for errors. In the meantime, you should keep old credit accounts open, use free apps that help you build credit, and look into becoming an authorized user on a trusted family member's credit card account.

Any of these steps can help you build credit quickly, but only if you get started now.