Eight ways to boost your credit score in 2021 - Which? News (2024)

If you're applying for a mortgage, a loan or even a mobile phone contract in 2021, then your credit score will be key to deciding your eligibility.

Your credit report will be provided to your chosen lender by a credit reference agency (CRA), most likely one of the 'big three': Experian, Equifax and TransUnion. The information in your report is distilled into a credit score.

While they all calculate your score slightly differently, most of the factors they use to make these calculations are the same.

So, whether you're trying to improve your score after the financial strains of 2020, or simply trying to ensure you're offered the best products this year, there are a few easy steps you can take to maximise your score.

Be more money savvy

free newsletter

Get a firmer grip on your finances with the expert tips in our Money newsletter – it's free weekly.

This newsletter delivers free money-related content, along with other information about Which? Group products and services. Unsubscribe whenever you want. Your data will be processed in accordance with our Privacy policy

1. Register to vote

One of the quickest and easiest ways to boost your score is to register to vote.

Experian says this alone will increase your credit score by 50 points.

If you move house, it's important that you are registered to vote at your new property, even if it's not an election year. It's worth bearing this in mind before making any new applications.

2. Don't miss a payment

Fundamental to your credit score is being able to demonstrate that you are responsible borrower: that you can repay your bills on time and stay within any limits you've been given.

Unfortunately, this was harder than normal in 2020 because of the pandemic. Thankfully most lenders have acknowledged this by offering payment holidays, which shouldn't affect your credit score.

If you are still struggling to pay off your debts or make your minimum payments, you should inform your lenders as soon as possible and try to negotiate further support. If this is no longer a formal payment holiday, it will appear on your credit report.

If you are late with a payment or miss one, it will show up on your report within a month. One late payment on a credit card or loan can dent your score by as much as 130 points, according to Experian.

A missed payment will show on your report for six years, although its effect will lessen. If you've missed only one payment, your score could start to recover after around six months and should be fully recovered after a year.

  • Find out more: will a payment holiday impact your credit score?

3. Unlock your data with open banking

In November 2020, Experian launched a new product, Experian Boost, that allows it to use open banking to securely view your current account transactions without your login details.

The innovation means that real-time banking information can be used to calculate your score for the first time.

This includes your income and general spending, as well as regular payments for things like council tax, savings and investments, and digital entertainment subscriptions like Amazon Prime, Netflix and Spotify.

Experian says that 17 million people could boost their score by up to 66 points by using the tool, providing a quick and easy way to increase your score in 2021.

  • Find out more: how your Netflix subscription can boost your credit score

4. Make your rental payments count

Tenants often complain that their rent doesn't count toward their credit score, especially as monthly rental payments can sometimes dwarf mortgages.

However, there are now a few ways that your rent can be included on your credit report and help improve your score.

Council or social housing tenants can ask their landlord to report their rental payments to a free scheme called The Rental Exchange so that the information will appear on their Experian credit report.

Private tenants can also ask their landlord to report rental payments to The Rental Exchange or they can choose to self-report via CreditLadder (reports to Equifax and Experian) or Canopy (reports to Experian).

Like Experian Boost, CreditLadder and Canopy use open banking to allow them to track rental payments through your current account - with your permission.

  • Find out more: Equifax to include tenants' rental payments on credit reports

5. Look for and correct mistakes

According to Experian, three in 10 people have never checked their credit report.

Not only does this mean that they won't know their chance of getting approved for financial products, but it also means they won't know if their report contains any errors.

Whether it's a minor mistake like a previous address being incorrect or a major error like a wrongly recorded missed payment, it can all affect your score and your ability to get credit. It could even help you spot products that have been fraudulently applied for in your name.

Also if you have taken a payment holiday or changed payment amounts, it can't hurt to check they've been recorded accurately.

If you do find an error, you can take it up with the lender directly, or alert the CRA who will contact them on your behalf. The CRA has 28 days to deal with the dispute and let you know what action will be taken.

  • Find out more: how to check your credit report for free

6. Use a credit-builder card

If 2020 has left you with a poor credit score, then one way of helping to raise it back up is a credit-builder credit card.

As the name suggests, the main aim of these cards is to help you improve or build a credit score, so they often have lower limits and higher interest rates than other credit cards, to encourage sensible, credit-building usage.

These cards could also come in handy if you have a 'thin file', the term CRAs use for borrowers who don't have much credit history.

You may think that this would count in your favour, but this is often not the case. CRAs need your history to help predict what kind of risk you are to lenders.

  • Find out more: credit-builder cards explained

7. Use 'soft searches' to check your eligibility

When applying for credit, most lenders will offer a 'soft search', which allows you to see your chances of being approved, without making a formal application and affecting your credit score. Always use these if possible.

Third parties and agencies also offer eligibility checkers that can 'pre-approve' you for a card, meaning your application should be successful.

This is an important step, as while your credit report provides most of the information needed for an application, CRAs don't actually make the decision.

In July, for example, the number of customers being pre-approved for credit cards using Experian's tool (24%) was half the rate it reached in August (50%). This wasn't because of anything to do with Experian or credit scores, but because of the economic certainty after the first lockdown, which saw many lenders tighten their lending and affordability criteria.

Checking your eligibility first means you shouldn't be affected by a rejection that is outside of your control.

8. Avoid multiple applications

If you do make an application and are turned down, try not to immediately apply for another product.

Multiple applications in a short period of time can count against you, as it may suggest you are in financial difficulty.

Whether an application is successful or not, it will be visible on your report for 12 months. Generally, it won't affect your chances of being approved for credit after three months. In fact, if you go six months without opening an account, you can get a boost of 50 points according to Experian.

Find out more: for more tips take a look at our full guide on how to improve your credit score or watch the video below

Eight ways to boost your credit score in 2021 - Which? News (2024)

FAQs

What brings your credit score up the fastest? ›

4 tips to boost your credit score fast
  • Pay down your revolving credit balances. If you have the funds to pay more than your minimum payment each month, you should do so. ...
  • Increase your credit limit. ...
  • Check your credit report for errors. ...
  • Ask to have negative entries that are paid off removed from your credit report.

What is the only proven way to improve your credit score? ›

Pay on time.

One of the best things you can do to improve your credit score is to pay your debts on time and in full whenever possible.

How to push past 750 credit score? ›

6 easy tips to help raise your credit score
  1. Make your payments on time. ...
  2. Set up autopay or calendar reminders. ...
  3. Don't open too many accounts at once. ...
  4. Get credit for paying monthly utility and cell phone bills on time. ...
  5. Request a credit report and dispute any credit report errors. ...
  6. Pay attention to your credit utilization rate.

How can I raise my credit score 100 points overnight? ›

  1. No, it is not possible to raise your credit score overnight. ...
  2. Improving your credit score typically requires responsible financial behavior over an extended period. ...
  3. Pay Your Bills on Time: Consistently make on-time payments for all of your credit accounts, including credit cards, loans, and utilities.
Oct 25, 2023

How can I raise my credit score 200 points in 30 days? ›

Try paying debts and maintaining your credit utilisation ratio of 30% or below. There are two ways through which you can pay off your debts, which are as follows: Start paying off older accounts from lowest to highest outstanding balances. Start paying off based on the highest to lowest rate of interest.

Can I pay someone to fix my credit? ›

You can always try to repair your credit yourself; however, depending on your financial situation, working with a reputable credit repair service may save you time and provide a better outcome in the long run.

What debt should I pay off first to raise my credit score? ›

Tackling your credit card debt first will also give you a better shot at improving your credit score. Revolving credit is highly influential in calculating your credit utilization rate, which is the second biggest factor (after payment history) that makes up your credit score.

What gives the most accurate credit score? ›

Simply put, there is no “more accurate” score when it comes down to receiving your score from the major credit bureaus.

How to raise credit score 50 points in 30 days? ›

7 Ways to Raise Your Credit Score in 30 Days:
  1. Dispute Credit-Report Mistakes. ...
  2. Make a Big Debt Payment. ...
  3. Reduce Your Credit Card Statement Balance. ...
  4. Become an Authorized User. ...
  5. Dispute Negative Authorized-User Records. ...
  6. Ask for a Higher Credit Limit. ...
  7. Write a Goodwill Letter.
Nov 7, 2016

Can you buy a house with a credit score of 750? ›

With a 750 credit score, you're in the running for pretty much every kind of home loan. FHA loans, VA loans and USDA loans all have much lower minimum credit score requirements, and conventional loans have a minimum credit score requirement of 620.

What is the average credit score by age? ›

Average FICO 8 score by age
Age groupAverage FICO 8 score
18-29680
30-39692
40-49706
50-59724
1 more row
Mar 7, 2024

Can you speed up credit score? ›

Keep paying your bills on time.

In many credit scoring formulas, your payment history has the greatest effect on your overall credit scores. So, it's critical to make payments on time. Even if you can't afford to pay your balance in full every month, try to pay the minimum — your credit scores will thank you.

How do I add utilities to my credit report? ›

Utility companies typically don't report your payment history to the credit bureaus. But paying utility bills on time can help your credit score when you use Experian Boost. This tool specifically integrates gas, electric, water and other utility payments into your Experian credit report and scores.

How can I raise my credit score 40 points fast? ›

Here are six ways to quickly raise your credit score by 40 points:
  1. Check for errors on your credit report. ...
  2. Remove a late payment. ...
  3. Reduce your credit card debt. ...
  4. Become an authorized user on someone else's account. ...
  5. Pay twice a month. ...
  6. Build credit with a credit card.
Feb 26, 2024

How to get a 700 credit score in 30 days? ›

Steps you can take to raise your credit score quickly include:
  1. Lower your credit utilization rate.
  2. Ask for late payment forgiveness.
  3. Dispute inaccurate information on your credit reports.
  4. Add utility and phone payments to your credit report.
  5. Check and understand your credit score.
  6. The bottom line about building credit fast.

How to get a 700 credit score in 2 months? ›

Pay on Time, Every Time

Your payment history is the most important factor in determining your credit score. Making on-time payments every month is crucial to getting your credit score above 700. If you have some late payments on your credit report, it may make it more difficult to build your credit score.

How many points does your credit score go up each month? ›

It all depends on your unique situation and the specific actions you're taking to improve your credit. Realistically, you probably won't see your credit score increase by more than 10 points in a month.

How quickly can credit score go up? ›

The length of time it will take to improve your credit scores depends on your unique financial situation. At the earliest, you may see a change between 30 and 45 days after you have taken steps to positively impact your credit reports.

References

Top Articles
Latest Posts
Article information

Author: Ms. Lucile Johns

Last Updated:

Views: 6384

Rating: 4 / 5 (41 voted)

Reviews: 88% of readers found this page helpful

Author information

Name: Ms. Lucile Johns

Birthday: 1999-11-16

Address: Suite 237 56046 Walsh Coves, West Enid, VT 46557

Phone: +59115435987187

Job: Education Supervisor

Hobby: Genealogy, Stone skipping, Skydiving, Nordic skating, Couponing, Coloring, Gardening

Introduction: My name is Ms. Lucile Johns, I am a successful, friendly, friendly, homely, adventurous, handsome, delightful person who loves writing and wants to share my knowledge and understanding with you.