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Credit Building

How Experian Boost can boost your credit

Recently checked your credit score and wished it could be even just a bit higher? Having a bad credit score doesn’t say anything about you as a person, and fortunately, like many things in life, credit is fixable.

Whether you’re shopping for a loan, looking for a new credit card, or simply looking to give your score a much-needed boost, it’s understandable to want to take better control of your credit and access the opportunities that a good score can afford.

The higher your score, the better your borrowing rates and terms tend to be—and the less money you’ll have to repay later. Unfortunately, there generally aren’t a whole lot of ways to increase it quickly.

So, what can you do to raise your credit score ASAP? Experian Boost may be the ticket. It’s a free service that helps you take advantage of your responsible payment habits by factoring in your recent history of on-time bill and rent payments into your FICO® Score 8.

Here’s an overview of how your credit score works and how Experian Boost may be able to help raise it.

The basics of a credit score

There are three primary consumer credit reporting companies in the United States—Experian, Equifax, and TransUnion. These companies collect and receive data on hundreds of millions of consumers, and they organize all this information to create and sell credit reports.

A credit-scoring model takes the information in a credit report and generates a number that represents the likelihood that an individual will fall behind on their debt payments.

Even if it can feel that way, it’s important to remember that a credit score isn’t a comment on your character, but rather a simple math model. It can also be a narrower way to judge your ability to repay a loan, and lots of companies are trying alternative methods in turn. That being said, your credit score remains one of the most popular measuring sticks when it comes to rates on loans, credit cards, housing opportunities, and even insurance.

Generally, three-digit credit scores range from 300 to 850. The higher your number, the better your credit score as you're perceived to be a more responsible borrower. These are the general ranges for different credit rankings.

  • 300-579: Very poor

  • 580-669: Fair

  • 670-739: Good

  • 740-799: Very good

  • 800-850: Exceptional

FICO and VantageScore are two of the largest credit-scoring agencies in the U.S., and each company has multiple credit-scoring models. When checking your credit (whether it’s you, a creditor, or a landlord), the score can vary depending on which credit-scoring model is being used and which credit report it’s based on.

The FICO Score 8 model

The FICO Score 8 model is the most widely used by all three credit bureaus and the majority of lenders. And that’s good news because your FICO Score 8 is the one that Experian Boost can improve.

A good, very good, or exceptional credit score will open up more credit options to you. That might mean credit cards with better benefits or a car loan with a lower interest rate.

FICO calculates your credit score based on a few distinct factors¹, including the following.

  • Payment history:

    Whether or not you make payments on time towards your credit cards and loans. This is the biggest factor that goes into your credit score, accounting for 35% of your score.

  • Credit utilization ratio:

    How much of your available credit you’re using. Generally, aim to only use 30% of your available credit. So if you have a credit card with a $20,000 limit, try to never have a balance of more than $6,000.

  • The length of your credit history:

    The longer the better.

  • Your credit mix:

    An ideal blend of credit cards, auto loans, student loans, a mortgage, etc.

  • Minimal new credit:

    Opening a bunch of new credit cards around the same time will drop your score, for example.

In terms of increasing your score, most of these factors take time. If you’ve missed payments in the past, all you can do now is to keep making payments on schedule to improve your payment history. Likewise, the only way to improve your credit history length is to wait. And although you might want to improve your credit mix, you also don’t want to open too much new credit too fast, either.

How Experian Boost works

When you register with Experian Boost, you allow Experian to connect to your bank accounts. It then determines if your bills are paid on time regularly by looking at your account statements.

Historically, only payments you make towards your loans and credit cards count toward your credit score. But with Experian Boost, you can grow your score via your history of on-time payments for other things—like your mobile or landline phone, internet, streaming, cable, or utility bills, as well as residential rent paid online.

Is Experian Boost worth it?

Well, to start with, it’s free. Registering for Experian Boost takes about five minutes. If it finds qualifying on-time payments, you’ll get a credit score boost instantly. Experian says average users saw their scores increase by 13 points after using Boost.

It’s natural to have concerns if you’ve had late payments in the past and are worried that these will hurt rather than help your score. Likewise, you may be worried about whether granting access to your bank account is actually safe and secure.

Fortunately, there is good news on both fronts. Experian Boost only pulls positive payment history. If you have late payments, Boost will skip right over them.

And, as far as security goes, the process is safe and secure. When you register with Experian Boost, it uses read-only access to your bank statements. It goes through these read-only statements, pulling the record of any on-time payments. Once it’s done, it doesn’t store any of your bank credentials. The only thing it keeps is the data on those positive payments.

And if your score does dip, you can just disconnect Experian Boost and your score should go back to its original number. A decreased score isn’t likely to happen, but given that Experian has a complex algorithm for calculating your Boost, they can’t 100% predict all outcomes when you register for this program.

Ultimately, Experian Boost can be worth it for the following reasons.

  • It helps you use the bills you’re already paying to get a higher credit score.

  • It’s free.

  • Registering is easy and safe.

  • Any late payment info won’t get applied.

  • You can just disconnect it if you don’t like it or your results.

All told, if you’re looking for a quick (and nearly instant) way to improve your credit score, Experian Boost is most likely your best and only option.

How else can I boost my credit?

Although most other approaches outside of Experian Boost will be longer term, even a few small changes can go a long way towards increasing your credit score and helping your financial future. Here are a few of the steps you can take to build or repair your credit over time.

  • Fix incorrect info on your credit reports:

    Start by looking for anything that’s not right when you check your credit reports. This could be anything like a wrong address, a credit account that you didn’t open, or an unsolicited hard credit check (when a lender pulls your credit report because you've applied for new credit). Dispute anything that isn’t right directly with the credit bureau.

  • Make payments on time:

    On-time payments for things like loans and credit cards make up the majority of your credit score. Although a late payment can stay on your record for a few years, it’s not forever. Making sure you pay at least the minimum amount every month from here on out can provide a boost to your score.

  • Keep your credit card balances low:

    Another large part of your credit score depends on how much debt you have on your credit cards, or your credit utilization ratio. Simply put, the closer you are to your credit limit, the greater the negative impact on your credit score. Try to get your balances as low as possible and as far from your upper credit limit as you can manage.

  • Pay off some debt:

    Relax—you don’t have to pay off every penny of debt to make a difference. Even starting with paying off credit cards or loans bit by bit can help raise your credit score over time.

  • Don’t open several new accounts at once:

    Every time you apply for a new loan or credit card, the lender performs a hard credit check. Each of these credit checks will lower your score by a few points. Plus, taking out more than one loan at a time can make you look like a riskier customer.

  • Consider a Varo Believe Card:

    The Varo Believe Card offers no hard credit check to apply, no minimum security deposit, and no annual fee or interest. It can potentially help you build your credit and keep track of your progress, provided you are responsible with your spending and make on-time payments².

  • Keep your old credit cards open:

    When you decide to stop using a credit card, it can be tempting to want to close the account to simplify your life—but hold that thought. Keeping it open can help with your credit history, which directly affects your credit score. Simply put, more years of credit equals a higher credit score.

Experian Boost can be a great way to immediately boost your credit by taking advantage of your positive bill or rent payment history. However, significantly increasing it requires more work and patience before you’ll see an impact on your credit score. Outside of Experian Boost, don’t be discouraged by a lack of visible changes in the short term. Instead, focus on the bigger picture—celebrating a higher credit score down the road and building a better financial future.

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