It can take 12 to 18+ months to build your credit from 500 to 700. The exact timing depends on which types of negative marks are dragging down your score and the steps you take to improve your credit going forward.
You can use WalletHub’s free credit score simulator to find out how specific actions will affect your score and how long it will take to reach your credit score goal.
Average Recovery Time for Negative Marks on Your Credit Report
Action | Average Recovery Time |
Applying for new credit | 3 months |
Closing an account | 3 months |
Maxing out a credit card | 3 months |
Missing a payment, default | 1-2 years |
Bankruptcy | 7-10 years |
Source: VantageScore
Derogatory marks, such as collections or bankruptcies, significantly lower your credit score. However, the negative impact declines as time goes on. You can expedite your credit score’s recovery, too.
How You Can Improve Your Credit Score From 500 to 700
To raise your score as soon as possible, you must inundate your credit reports with positive information. The two most important factors affecting your credit score are payment history and credit utilization. Below, we highlight some of the steps you can take to improve both.
Pay All of Your Bills on Time
You have to consistently pay all of your bills on time in order to build a good or excellent credit score. Even one late payment on your credit report can cause your score to fall by up to 100 points, or even more in some cases.
Late payments can indicate to lenders you are not reliable when it comes to managing your financial obligations, which can make it more difficult for you to obtain credit in the future. If you are having trouble making payments, you should contact your creditors as soon as possible to discuss your options.
Reduce Your Debt
The more debt you have, the worse it generally is for your credit score. You can employ a variety of strategies to help reduce your debt, including simple budgeting and using a balance transfer credit card or debt consolidation loan to lower the cost of what you owe.
In addition, you could attempt to negotiate with creditors to lower your interest rates or monthly payments, or seek professional guidance from a non-profit service. Effective debt management can help you improve your credit score and maintain financial stability in the long term.
Use a Secured Card Responsibly
You can use a secured credit card to build a history of on-time payments. Secured cards usually require a deposit, the amount of which also serves as your credit limit, making them easy for people with a 500 credit score to get approved for. You can compare the best secured cards for free here at WalletHub.
Bring Your Utilization Below 30%
Credit utilization measures how much of your credit limit you’re using, based on your monthly statement balance. It’s calculated for each line of credit you have as well as for all of them together. Keeping your utilization below 30% is good for your credit score, and a ratio of 1-10% is ideal. High credit utilization can signal that you are relying too heavily on credit and may not be able to manage your debts effectively.
You can use WalletHub’s free credit score simulator to find out how specific actions may help your credit and get personalized credit-improvement tips from our analysis tool.
This answer was first published on 04/04/23. For the most current information about a financial product, you should always check and confirm accuracy with the offering financial institution. Editorial and user-generated content is not provided, reviewed or endorsed by any company.
FAQs
The time it takes to raise your credit score from 500 to 700 can vary widely depending on your individual financial situation. On average, it may take anywhere from 12 to 24 months of responsible credit management, including timely payments and reducing debt, to see a significant improvement in your credit score.
How long does it take to go from 500 to 700 credit score? ›
For instance, going from a poor credit score of around 500 to a fair credit score (in the 580-669 range) takes around 12 to 18 months of responsible credit use. Once you've made it to the good credit zone (670-739), don't expect your credit to continue rising as steadily.
How to go from a 500 to a 700? ›
To increase your credit score from 500, ensure that you repay your existing debts on time. If you are already doing it, you may go a step further and take out new type of loans. Having a healthy mix of credit also helps to boost your credit score. And remember, not to utilize more than 30% of the available credit.
How to get credit score from 580 to 700? ›
How To Get A 700 Credit Score
- Lower Your Credit Utilization Ratio. Credit utilization makes up the second-largest percentage of your credit score. ...
- Space Out New Credit Applications. ...
- Diversify Your Credit Mix. ...
- Keep Old Credit Cards Open. ...
- Make On-Time Payments.
How to go from 550 to 750 credit score? ›
Taking these steps could help you increase your credit score from the fair range to the good range and potentially nab you future savings:
- Check your credit reports.
- Pay all your bills on time.
- Focus on paying down your debts.
- Don't max out your credit cards.
- Maintain a variety of credit accounts.
How to get a 720 credit score in 6 months? ›
To improve your credit score to 720 in six months, follow these steps:
- Review your credit report to dispute errors and identify areas for improvement.
- Make all payments on time and avoid applying for new credit.
- Lower your utilization ratio by paying down balances, increasing credit limits, or consolidating your debt.
Is 700 a good credit score to buy a house? ›
Yes. Assuming the rest of your finances are solid, a credit score of 700 should qualify you for all major loan programs: conventional, FHA, VA and USDA loans all have lower minimum requirements, and even jumbo loans require a 700 score at minimum.
Is 650 a good credit score? ›
As someone with a 650 credit score, you are firmly in the “fair” territory of credit. You can usually qualify for financial products like a mortgage or car loan, but you will likely pay higher interest rates than someone with a better credit score. The "good" credit range starts at 690.
What can a 500 credit score get you? ›
What Does a 500 Credit Score Get You?
Type of Credit | Do You Qualify? |
---|
Secured Credit Card | YES |
Home Loan | YES (FHA Loan) |
Unsecured Credit Card | MAYBE |
Auto Loan | NO |
1 more row
How to raise your credit score overnight? ›
How to Raise Your Credit Score 100 Points Overnight
- Become an Authorized User. This strategy can be especially effective if that individual has a credit account in good standing. ...
- Request Your Free Annual Credit Report and Dispute Errors. ...
- Pay All Bills on Time. ...
- Lower Your Credit Utilization Ratio.
How to Raise your Credit Score by 200 Points in 30 Days?
- Be a Responsible Payer. ...
- Limit your Loan and Credit Card Applications. ...
- Lower your Credit Utilisation Rate. ...
- Raise Dispute for Inaccuracies in your Credit Report. ...
- Do not Close Old Accounts.
Is 700 a good credit score to buy a car? ›
As you can see, a 700 credit score puts you in the “good” or “prime” category for financing, making 700 a good credit score to buy a car. While it's always a good idea to get your credit score in its best possible shape before buying a car, if you're already around the 700 range you will be good to go.
Why did my credit score go from 524 to 0? ›
Credit scores can drop due to a variety of reasons, including late or missed payments, changes to your credit utilization rate, a change in your credit mix, closing older accounts (which may shorten your length of credit history overall), or applying for new credit accounts.
How rare is a 750 credit score? ›
Your credit score helps lenders decide if you qualify for products like credit cards and loans, and your interest rate. You are one of the 48% of Americans who had a score of 750 or above as of April 2023, according to credit scoring company FICO.
How to repair credit fast? ›
How to improve your credit score
- Check your credit report for errors. ...
- Prioritize paying on time. ...
- Work to pay down your debts. ...
- Become an authorized user. ...
- Request a credit line increase. ...
- Handle debt in collections. ...
- Consider opening a secured card. ...
- Get credit for other payments.
Can your credit score go up 200 points in 3 months? ›
However, it'll take much longer to reach your goal if you're trying to raise your score by 200 points. Patience is key here! It may take anywhere from six months to a few years to help raise your score by 200 points depending on your financial habits.
Is 500 credit score fixable? ›
There are no quick fixes for a Very Poor credit score, and the negative effects of some issues that cause Very Poor scores, such as bankruptcy or foreclosure, diminish only with the passage of time. You can begin immediately to adopt habits that favor credit score improvements.
How to increase credit score by 100 points in 30 days? ›
Steps you can take to raise your credit score quickly include:
- Lower your credit utilization rate.
- Ask for late payment forgiveness.
- Dispute inaccurate information on your credit reports.
- Add utility and phone payments to your credit report.
- Check and understand your credit score.
- The bottom line about building credit fast.
How to go from 500 to 800 credit score? ›
How to Get an 800 Credit Score
- Pay Your Bills on Time, Every Time. Perhaps the best way to show lenders you're a responsible borrower is to pay your bills on time. ...
- Keep Your Credit Card Balances Low. ...
- Be Mindful of Your Credit History. ...
- Improve Your Credit Mix. ...
- Review Your Credit Reports.