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How long does it take to build credit?

How long does it take to build a "High" credit score.?

  • First things first I am new to the whole credit thing, I recently got approved of a $500 limit capital one card for students, I have no credit scores obviously since I've never used credit cards or anything else that reports to credit companies. My question is how long exactly will it take me if I started today, to get a good score if I pay it every month on time, and used 60% of the balance every month and having no problems. I need an estimation.

  • Answer:

    This should help you to understand how credit scores work.. FICO scores from 300 to 850 and Vantage Plus scores from 501 to 990. Here is the breakdown for both systems. Vantage Plus system scores from 501-990. A-901-990 B-801-900 C-701-800 D-601-700 F-501-600 FICO system scores from 300-850. Elite-740-& up Prime-700-739 Preferred-660-699 Standard-625-659 Sub-prime-624-& under FICO is the only one that matters since it's the one that all major lenders look at. So as you can see it depends on if your looking at a true FICO score or a Vantage plus score. As far as what makes up credit scores it's the following; 1. Payment history (longer the better) 35% 2. Time in bureau (longer the better) 15% 3. Types of credit (mix of credit cards & installment loans) 10% 4. New credit (new accounts and inquiries) 10% 5. Debt to credit ratio (lower the better) 30% So as you can see credit is based on opening and paying accounts. So without that you would have no score at all. To answer your question the credit bureaus use different scoring systems. Equifax uses FICO, Experian uses Vantage and Transunion uses both depending on what type of bureau is pulled of which there are 3. The standard that you see, the auto enhanced that only auto dealers and lenders see and the factual which only mortgage companies and lenders see. So each person can have 9-different scores none of which will match. Great system huh. Add to this that all lenders do not even report to all 3 creidt bureaus and some don't report at all and you begin to see the problem with our current system. All in all, a good score can be generated in as little as 12-months but a great score and profile to back it up require at least 24-months.

Marcelain Ekutshu at Yahoo! Answers Visit the source

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Other answers

Apply for a secured cc. For great results only use 10-25% of the credit limit. Pay off in full and on time every month. don't close thee cc account, lenders want to see that history of credit. don't apply to too many credit cards at one time. This will hurt your score. only if you really need it. good luck!!!!

Bethany Raul

1 to 2 years to develop credit. It takes time..... Oening more credit cards can hurt your credit. All you need is one. How to get great credit with that card: Use it for one thing you need like food or gas. Pay in full when you get the bill in the mail. Not the minimum, not more than the minimum, but in full. This way, you never pay interest and develop great credit with time. After 6 months (6 payments cleared) call up your credit card company and ask for a credit limit increase. Don't pay for your score - consider it an useless waste of money. Ask yourself why do you need a high score? Plenty of people get their first cars without any credit. A lender just wants to see sufficient income to easily support your loan payments, and long standing, stable employment. Take your tax returns, last pay stub, and a copy of your checking statement.

Go with the flow

if you use 60% every month and pay it in full you will loose 1-3 points per month because the score system penalizes usage over 30%. You will destroy your young credit.

Calvin C

A good score is 660/749 and takes 24 months of activity.

Stan

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