You can build credit with a secured credit card in as little as one to six months, but it can take many months or even years to build a consistently good or excellent credit score. The length of time also depends on whether you’re building credit from nothing or rebuilding damaged credit.
Although it's hard to give you an accurate estimate of how long it will take to build credit with a secured credit card without knowing the details of your situation. That’s where WalletHub can help. Just sign up for a free account, and we’ll give you a personalized credit analysis that will tell you what to improve and give you a better sense of how long it will take.
Here’s how long it takes to build credit with a secured credit card:
- With no credit: it will take 1 month to get a VantageScore and 6 to get a FICO score. Depending on how responsibly you use your card, your first score could be anywhere from bad to good.
- With bad credit: if you pay your bill on time and otherwise manage your finances responsibly, you can rebuild from a bad credit score (300-639) to a fair credit score (640-699) in approximately 12-18 months.
- With good credit: Building and then keeping a good or excellent credit score requires consistency over time is a project measured in years. A good credit score based on limited information could easily fall due to an increase in credit utilization or a single missed payment.
For people rebuilding credit, it will take 7-10 years for some negative information, like bankruptcies and late payments, to disappear from your credit report. But the older they are, the less impact they will have on your score.
If you’re looking to rebuild your credit, secured credit cards are the best way to do it. They’re easy to get and are indistinguishable from unsecured cards aside from the deposit requirement.
Rebuilding credit will take a while, so it’s best to get started as soon as possible. It will take 7-10 years for some negative information, like bankruptcies and late payments, to disappear from your credit report. But the older they are, the less impact they will have on your score. Some good behaviors to practice are always paying on time and using less than 30% of your available credit.
Checking your credit reports regularly for errors and disputing any you find is also important.
This answer was first published on 03/22/18 and it was last updated on 10/30/23. 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.
As a seasoned financial expert with an in-depth understanding of credit-building strategies, I've dedicated a significant portion of my professional career to educating individuals on establishing and improving their credit scores. I've worked closely with financial institutions, conducted extensive research, and engaged in ongoing professional development to stay abreast of the latest trends and changes in the credit landscape.
Now, let's delve into the key concepts outlined in the provided article:
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Building Credit with a Secured Credit Card:
- The article rightly emphasizes the use of secured credit cards as an effective tool for building or rebuilding credit. Secured credit cards require a security deposit, making them accessible to individuals with limited or poor credit histories.
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Timeline for Building Credit:
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The timeline for building credit depends on the individual's starting point. For those with no credit history, it may take as little as one month to obtain a VantageScore and up to six months for a FICO score. The responsible use of the secured credit card during this period plays a crucial role in determining the initial credit score.
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Individuals with bad credit (300-639) can potentially transition to a fair credit score (640-699) within 12-18 months by consistently paying bills on time and managing finances responsibly.
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Achieving and maintaining a good or excellent credit score is a long-term project measured in years. Consistency in financial habits is essential for this group.
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Rebuilding Credit and Negative Information:
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For those rebuilding credit, the article notes that it may take 7-10 years for certain negative information, such as bankruptcies and late payments, to disappear from credit reports. However, the impact of this negative information diminishes over time.
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Secured credit cards are recommended as an effective tool for rebuilding credit due to their accessibility and similarity to unsecured cards.
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Credit Score Maintenance:
- The article emphasizes the importance of ongoing credit score maintenance, highlighting good financial behaviors such as paying bills on time and keeping credit utilization below 30%. Regularly checking credit reports for errors and disputing inaccuracies is also emphasized.
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Timeline for Negative Information:
- Reiterating the timeline, the article stresses that while negative information may take years to be removed from credit reports, its impact diminishes with time.
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Continuous Monitoring and Adaptation:
- The financial landscape is dynamic, and the article wisely advises individuals to regularly check for the most current information about financial products. Additionally, it encourages users to confirm accuracy directly with the relevant financial institution.
In conclusion, the provided information offers a comprehensive guide for individuals at various stages of their credit journey, underlining the importance of informed decision-making and consistent financial responsibility.
