Waiting for your credit score to improve seems like it can take forever. If you're checking daily, like most of us do now that there are so many convenient apps to keep up with your score, you probably notice that your credit score moves up and down all the time. One day you might gain a few points; the next day, you might lose a few. This can happen even if you're checking your score from the same credit bureau on the same app.
While the changes may be a little concerning, especially if you're considering applying for a mortgage or car loan soon, they're completely normal.
How Often Does Your Credit Score Change?
Your credit score isn't updated on any regular basis or on any specific day of the month. In fact, it could change as often as daily, depending on how often your credit report is updated. Remember, your credit score is a numerical summary of the information in your credit report, which is essentially a compilation of your credit accounts with various businesses.
Your creditors and lenders continuously update your credit report throughout the month and not necessarily on a specific day of the month. And each time you check your credit score, it's recalculated based on the information in your credit report at that particular point in time. Because of this dynamic, your credit score can change as information on your credit report is added, deleted, or aging.
These changes to your underlying credit report explain why your credit score may be different today compared to yesterday. Your credit score might also remain stagnant for several days, then suddenly gain or lose several points.
While your credit score can change daily, it doesn't necessarily respond instantly to actions you take with your credit. For example, if you pay off a credit card today, your credit score may not reflect that payment for several weeks unless it's around your statement closing date. That's because there's typically a delay between the time you take the action and the time the creditor reports that change to the credit bureaus.
What Do Credit Score Changes Mean?
Your credit score may fluctuate daily, but don't rely on these small movements - whether up or down - as an indication as to whether your credit is improving overall. Instead, gauge the movement of your credit score over a period of time, several weeks or months, to get an idea of where your credit is headed.
On the other hand, if you see a big drop in your credit score, you should investigate it further to see what's caused such a major change in your credit score. There may have been new negative information added to your credit score, like a late payment, a new account, or a large credit card balance amount. Occasionally, old information falling off your credit report can cause your credit score to drop. In some cases, your credit score can drop even if an old collection account falls off your credit report.
Most negative information can only be included in your credit report for seven years. Exceptions to this rule include ten years for Chapter 7 bankruptcy or two years for hard inquiries.
You can monitor daily changes to your Equifax and TransUnion credit scores via Credit Karma and monthly changes to your Experian credit score via Credit Sesame. Both services are free and don't require a credit card or trial subscription to enroll. They're both great services to track changes to your credit scores and include tools to let you know how the information in your credit report has changed. This makes it easier to gauge what credit report information is contributing to movements in your credit score.
Some free credit score services only refresh your credit score weekly or monthly. You could see more significant changes to your credit score from one update to the next, depending on your credit report activity during that time.