How many FICO points can I gain in one year?

I can't tell you exactly how long it will take, but I can certainly share with you how the system works, so you'll make more informed decisions. Your credit score is determined by the following: 35%: Bill-paying history. Mostly everyone knows how important it is to pay your bills on time. And that's because that's the factor that can the most impact your credit score. It's also worth noting that it's more a question of pattern. What that means is that one 60-day late payment will have less of an impact that a string of 30-day late payments 30%: Debt usage ratio. That is the amount of debt you have outstanding compared to your total credit limit. A generally accepted rule of thumb is that this ratio should be kept under 25% for best results. Between 25 and 50% isn't too good for you, but the impact is fairly manageable. Going over 50% should definitely be avoided 15%: Length of credit history. The longer your history, the better. It allows any potential lender to have a more accurate picture of you. 10%: Mix Of Credit. Showing the ability to successfully manage different types of credit has a posotive impact on your score (revolving credit, consumer finance, installment loans, and so on) 10%: Pursuit of new credit. Having many recent inquiries on your credit report is interpreted by lenders as a sign that you're financially strapped. The good news is that since shopping around for a loan is the smart thing to do, credit score calculations have been altered so that all inquiries of the same type, made within a reasonable time frame (15-30 days, depending on the type of loan in question), count as one single inquiry. The credit score calculation formula gives more "weight" to new information, making it easier to offset previous negative information with a couple years' worth of good behavior. Of course, it also works the other way and one bad year will greatly damage an otherwise perfect picture Because of the "debt usage ratio" and "length of credit history" factors, it's unwise to close credit accounts even if you've paid them off. Doing so reduces your credit limit, so any ratio you had will automatically become higher. And it's also like you're deleting credit history because that information is no longer accessible to lenders. In short, the longer you've had the card, the bigger the limit, and the better you've managed it, the more you stand to lose by cancelling it. One of the fastest ways to build (or rebuild) credit is to go to a local bank and purchase a CD, then use it as a collateral on a 6- or 12-month loan. The interest rate will be very low, and the payments will help your credit history in several areas, namely bill-paying history and mix of credit.