Author: Philip Tirone

After studying tens of thousands of credit reports, helping over 200,000 people, and spending decades as a mortgage broker, I’ve seen the same surprising truth play out again and again: most people are in a better position to rebuild after bankruptcy than they were before it. After all, they are no longer struggling to pay their bills.

In fact, with the right steps, your score can hit 720 in as little as one to two years.

The key is knowing what to do, and when to start. (Spoiler: it’s now.)

In this article, I’ll walk you through what happens to your credit score after bankruptcy, how to start building credit after a bankruptcy, and which credit-building moves make the biggest impact. 

FAQ: How soon can I start building credit after a bankruptcy?

Answer: Right away. In fact, most people are surprised to learn that it’s easier to rebuild your credit score after bankruptcy than before. That’s because you’re in a better financial position after bankruptcy: your overdue balances are gone, and you’re no longer juggling payments you can’t afford.

On the other hand, before the bankruptcy, you were likely maxing out your credit cards, and you might have been paying your bills late, which are both things that can cause your credit score to drop. 

If you start rebuilding your credit score right away, your credit score can increase to 720 (which is considered a great score) in just one or two years. 

We recommend starting a credit-rebuilding strategy the same month your bankruptcy is discharged (Chapter 7) or confirmed (Chapter 13). Programs like 7 Steps to a 720 Credit Score and the Credit Rebuilder Program are designed to guide you through this process from day one.

Watch & Learn: Will Bankruptcy Destroy Your Credit?

FAQ: Will my credit score go up or down when my bankruptcy is discharged?

Answer: It depends on where your score was before filing. If your credit was already low because of missed payments, maxed-out cards, or accounts in collections, your score might go up once the bankruptcy is discharged. That’s because many of your overdue balances get wiped out, and your debt-to-income ratio improves overnight.

If your score was high going into the bankruptcy, you might see a drop. But even then, the dip is usually short-lived if you take the right steps to rebuild your credit after the bankruptcy. Think of your bankruptcy as a clean slate. If you adopt new habits after the bankruptcy, your score can climb to 720 in 12 or 24 months. Namely, you should:

1.   Open three new credit cards
2.   Pay your credit cards on time and keep the balance low (no higher than 30 percent of the limit) 
3.   Remove all errors from your credit report
4.   Add an installment account to your credit report

You can learn more by joining free credit-education programs like 7 Steps to a 720 Credit Score. 

FAQ: What’s the fastest way of building credit after bankruptcy?

Answer: The key is to start right away. A lot of people think they have to wait 7 to 10 years for the bankruptcy to fall off their credit report before they can do anything, but that’s the slowest possible path.

Here’s what most people don’t realize: Credit bureaus care more about what you’re doing now than what happened in the past. The newer your positive behavior, the more weight it carries. So if you start rebuilding today, your score can start improving in just a few months. Most people who follow a focused plan see real progress within 12 to 24 months, even with the bankruptcy still on their report.

But if you wait seven years to get started, you’re really looking at eight or nine years before you’re back in good shape. That’s a long time to sit on the sidelines.

So what’s the game plan?

• Open the right kinds of credit. That means that you open three new credit cards and one installment account after your bankruptcy has been discharged or confirmed. This gives the credit-scoring bureaus new information on your patterns of behavior after the bankruptcy.
• Keep your balances low on your credit cards. Aim to use less than 30% of your available credit, but using less than 10% is even better. That tells lenders you’re not relying on credit to get by.
• Pay on time, every time. Even one late payment can set you back. Automate where you can.
• Fix reporting errors. After bankruptcy, your credit report can be full of mistakes related to the bankruptcy. Get them corrected so you’re not being unfairly penalized.
• Follow a system. Programs like 7 Steps to a 720 Credit Score and the Credit Rebuilder Program take the guesswork out of the process and help you stay on track.

Don’t wait. Every month you delay is a missed opportunity to show the credit bureaus that you’ve changed—and to get closer to the score you want.

Watch & Learn: Building Credit After Bankruptcy Through a Credit Rebuilder Program

FAQ: Can I qualify for a credit card after filing for bankruptcy?

Answer: Yes, though you may pay high interest rates on traditional credit cards. Credit cards designed for people with poor credit often come with a high APR, or Annual Percentage Rate. This is the total cost of borrowing over the course of a year, including interest and fees. The higher the APR, the more you’ll pay in interest if you carry a balance from month to month.

If you’re having trouble qualifying for a traditional credit card, you’re not out of options. One workaround is to apply for a secured credit card. Another is to ask someone you trust to add you as an authorized user on their credit card. Both can help you rebuild credit, but they work in very different ways, and each comes with its own pros and cons.

Building Credit After Bankruptcy Through a Secured Credit Card

A secured credit card is a great starting point if you’re rebuilding your credit, but it works a little differently than a traditional credit card. To open one, you’ll need to make a refundable deposit (usually a few hundred dollars) that becomes your credit limit. So if you put down $300, your limit is $300. 

But here’s something a lot of people misunderstand: the deposit doesn’t go toward paying your monthly bill. It just sits there as collateral. You still use the card to make purchases, and then you’re expected to pay off those charges, just like you would with any other credit card. If you don’t pay the bill, the lender can keep your deposit and report your payment as late. If you use the card responsibly and eventually decide to close it, or if you graduate to an unsecured card, then and only then do you get your deposit back, as long as your balance is paid in full.

The upside is that most secured cards report to all three credit bureaus, which means every on-time payment helps rebuild your credit. Just make sure to pay the bill in full and on time, and keep your balance low.

Be sure to read this article: “Is It Possible to Get Credit Cards After Bankruptcy?” And be sure to check out our list of credit cards designed for people with poor to fair credit.

Building Credit After Bankruptcy Through Authorized User Accounts

An authorized user account works a little differently. This is when a friend or family member adds you to their existing credit card. You don’t have to apply or put down a deposit. You’ll benefit from their payment history and length of credit, which can give your score a nice boost, as long as they’re responsible with the account. If they carry a high balance or miss payments, it can actually hurt your score instead of helping it. So make sure it’s someone you trust, and that they understand what’s at stake.

Neither option is perfect, but both can be powerful tools if used the right way. Some people even do both: they get a secured card to build their own credit while becoming an authorized user to strengthen their history even faster.

FAQ: How many credit cards do I need to start building credit after bankruptcy effectively?

Answer: Three. That’s the number we recommend if you’re serious about building your credit after bankruptcy.

That might sound surprising, especially if you’ve just been through a financial crisis like bankruptcy, but here’s the thing: this isn’t about going into debt. Opening credit cards after bankruptcy is about proving to the credit bureaus that you can use credit responsibly now, which is how you rebuild trust and how your score starts to improve. 

Opening three credit cards gives you more room to show positive behavior. About 35 percent of your credit score is based on your payment history, so when you open three cards after a bankruptcy, and then pay them on time, you give the credit-scoring bureaus more data about your new-and-improved behavior. 

And here’s an important tip: try to open them around the same time. One factor that affects your score is the age of your accounts. If you open one card now and wait six months to open the others, the new ones will drag down your average account age. But if you open all three close together, they’ll age together, and that helps your score in the long run.

You don’t need to spend much. Use each card for something small, like a streaming service or a gas fill-up, then pay it off in full every month. 

It might feel strange at first, but these three cards can become the foundation of your financial comeback. And the sooner you start, the sooner they start working in your favor.

When I first started teaching people how to rebuild their credit almost three decades ago, one of the biggest sources of confusion was the credit score you get from banks (and now from apps). People would come to me saying, “Phil, Chase says my score is 720. Why did I get denied for a loan?”

I get it. It’s frustrating and confusing. But once you understand how credit scores are created, and which ones lenders actually use, it all starts to make sense. In this article, we’ll break it down so that you understand credit-scoring models and how to gauge your credit score.

What Credit Score Does Chase Show?

Chase provides something called a VantageScore 3.0, which is based on a mathematical formula pulled from your TransUnion credit report.

But here’s the important part: The formula applied to create the Chase credit score isn’t the same formula that is used to create a FICO score, which is the model most lenders use. And most lenders will take a look at not only your TransUnion credit report, but also your Experian credit report, and your Equifax credit report.

This might come as a surprise, because most lenders use your FICO score to make credit decisions. In fact, around 90% of lending decisions are based on a version of the FICO model, especially when it comes to mortgages, car loans, and major credit cards.

FICO and VantageScore pull from the same types of data: payment history, credit utilization, length of credit history, and so on. But they weigh those factors differently. That means your score can look different depending on which model is used, even though the underlying credit report is the same.

Think of it like two chefs using the same ingredients to make a dish. One might prioritize spice, the other sweetness. The final result looks similar, and the dish might be called the same thing by both chefs, but it tastes different. That’s what’s happening with your credit scores: same data, different recipe.
So if you’re monitoring your credit with Chase, it’s a great way to track trends and get a general sense of your credit health, but don’t assume that number is what lenders will see when they pull your FICO score.

Watch & Learn: Do You Feel Stuck in Debt?

VantageScore vs. FICO: What’s the difference?

So what’s the difference?

Your credit score is calculated using the information in your credit report, things like:

• Your payment history
• How much debt you’re carrying
• How long you’ve had credit accounts
• What types of credit you use
• How recently you’ve opened new accounts

This information is plugged into a complex mathematical formula that spits out your credit score. But not all scoring models weigh those factors the same way.

• FICO and VantageScore are two competing credit scoring systems.
• Both use the same 300–850 scale, but the formula behind them is different.
• That’s why you can have a 720 VantageScore and a 680 FICO score; both are “accurate,” just calculated differently.

In short: Your Chase credit score is a real credit score, but it is limited in its usefulness because it is not the one most lenders are using. While it’s helpful for tracking trends, don’t assume it’s what a bank will see when you apply for credit.

Why Is My Chase Credit Score Different From Other Scores I’ve Seen?

Here’s something that might seem a little confusing, so I’ll break it down. You have many credit scores. In fact, the Consumer Financial Protection Bureau reports that consumers can have dozens of scores depending on:

• The credit bureau providing the report (TransUnion, Experian, Equifax)
• The scoring model (FICO 8, FICO 9, FICO Auto Score, VantageScore, etc.)
• The version of the scoring model
• The date your data was pulled

Here’s an example: Let’s say Chase shows your VantageScore 3.0 as 720. But if a mortgage lender pulls your FICO Score 2 based on Experian, it could be 685. Both scores are accurate in their own right. They’re just calculated differently.

Making it even more confusing, when a lender pulls your FICO Score 2, they will get three scores: One from Experian, one from TransUnion, and a third from Equifax. They will ignore the highest and the lowest scores, and they will assign you an interest rate based on the middle score.

Watch & Learn: Building Credit Through a Credit Rebuilder Program

Can I Trust Chase’s Credit Score?

You can trust the Chase credit score to monitor trends and get a general idea of where you stand, but you cannot trust it to be an accurate indicator of the terms you will receive on a credit card, mortgage, or car loan.

Here’s an example: If your Chase score drops, there’s a good chance your FICO score dropped too. If it rises, your FICO likely did as well.

But don’t make major credit decisions like applying for a mortgage or car loan based only on the score you see in your Chase dashboard. Get your real FICO scores first. (You can likely get your FICO score by asking a mortgage broker to pre-approve you for a loan.)

Does a High Chase Credit Score Mean I’ll Qualify for a Loan?

Not always. Lenders rarely use VantageScore to make approval decisions. Even if you have a 730 score with Chase, your FICO could be in the 600s depending on:

• Credit card balances
• Recent inquiries
• Derogatory marks
• Age of accounts

If you’re preparing for a big financial step, like buying a home, leasing a car, or applying for new credit, check your FICO scores in advance.

What If My Chase Credit Score Is Low?

More than 30 years ago, I was a mortgage broker helping people buy homes. One day, I walked into the bank and found out I was overdrawn. When I tried to apply for overdraft protection, I was denied. That moment was humiliating and eye-opening. I knew I had to change something. So I started learning everything I could about credit scores: How they’re built, how they’re damaged, and most importantly, how to rebuild them.

If you’re looking to improve your credit score fast, Chase or FICO, the first step is to figure out why your score is low. For some people, it’s because they don’t have enough credit history. In that case, becoming an authorized user on someone else’s well-managed credit card can give your score an instant boost. For others, high credit card balances are the problem. Lowering your credit utilization, ideally under 30 percent of your limit, or even better, under 10 percent, can lead to major gains in just a few months.

Another powerful strategy is cleaning up errors on your credit report. We’ve seen clients jump 50 to 100 points simply by disputing accounts that should have been removed after bankruptcy or fixing reporting mistakes. If you have collections on your report, paying them off doesn’t always help your score, but negotiating a pay-for-delete agreement can. And even when deletion isn’t possible, resolving the debt can reduce stress and show future lenders you’re taking responsibility.

Finally, building new, positive credit history is key, particularly if you have been through a bankruptcy. Most people think it takes seven years to rebuild a credit score, but that’s a myth. With smart, consistent habits, you can often go from the 500s to the 700s in 12 to 24 months. Focus on what the scoring models care about: recent behavior, on-time payments, low balances, and a steady track record.

Need Help?

Our program, 7 Steps to a 720 Credit Score, is built around the actual scoring models lenders use, and it works even after bankruptcy.

Want to raise your real credit score?

Join the thousands of people who have rebuilt their credit in just 12 to 24 months.
Start the free credit-education program, and take control of your credit with a plan that actually works.

Related Articles: 

“Does Overdraft Affect Credit Scores?”

“Does Klarna Affect Your Credit Score?”

“Does the Method for Calculating Credit Scores Seem Fair to You? Why or Why Not?”

FAQ Table of Contents

Why is my Chase credit score different from my FICO score?

Is the Chase credit score accurate enough to trust?

Does a high Chase credit score mean I’ll qualify for a loan?

Which score do lenders use, Chase or FICO?

How should I use the Chase credit score in my financial planning?

FAQ: Why is my Chase credit score different from my FICO score?

The score you see in your Chase account is a VantageScore, while most lenders use FICO. Both FICO and Vantage pull data from your credit report, but they weigh the information differently. That’s why your Chase Vantage score might show 720 while your FICO comes in at 685.

Think of it like two teachers grading the same essay with different rubric criteria. The work is the same, but the results vary depending on what each teacher prioritizes. Both scores are “real,” but FICO is the one lenders will use when deciding whether to approve you and at what interest rate.

Key takeaway: Your Chase score isn’t wrong, but it isn’t the number lenders rely on. Always check your FICO before applying for credit. You can learn how to pull your FICO and improve it, for free, in our free credit-education program, 7 Steps to a 720 Credit Score.

Return to FAQs

FAQ: Is the Chase credit score accurate enough to trust?

Yes and no: The Chase score is accurate for tracking trends, but it’s not accurate for predicting loan terms because lenders use FICO and not the Chase VantageScore formula to make final decisions.

That said, if your Chase score goes up or down, chances are your FICO moved in the same direction. But before applying for a mortgage, car loan, or credit card, check your actual FICO so you know exactly what lenders will see.

Key takeaway: Trust Chase for changes, not for loan decisions.

Return to FAQs

FAQ: Does a high Chase credit score mean I’ll qualify for a loan?

Not necessarily. A Chase score of 730 might look like a great credit score, but if your FICO score is 680, a lender could deny you or approve you with far less favorable terms. That difference happens because Chase shows you a VantageScore, while most lenders use FICO. Both scores are based on the same credit report, but they use different formulas to calculate risk.

This mismatch is one of the most common frustrations people face. Many borrowers apply for a car loan or mortgage feeling confident because their banking app shows a “good” score, only to find out the lender sees a lower FICO score. That lower score means higher interest rates or even rejection.

For example, imagine two people with the same Chase score of 730:

• One has a FICO score of 720 and qualifies for a $20,000 car loan at 6% interest.
• The other has a FICO score of 680 and gets offered the same loan at 11%.
  That gap translates into thousands of dollars in extra interest, all because the score they trusted wasn’t the one lenders rely on.

Key takeaway: A high Chase score doesn’t guarantee loan approval. Only your FICO score determines the terms you’ll receive. The good news is you can raise your FICO score quickly by following the right steps. Our free credit-education program, 7 Steps to a 720 Credit Score, shows you how.

Return to FAQs

FAQ: Which score do lenders use, Chase or FICO?

Lenders almost always use a version of FICO. For mortgages, they even pull three different FICO versions (one each from Experian, TransUnion, and Equifax) and use the middle score. Chase only shows you a VantageScore based on TransUnion data, which doesn’t provide the full picture.

So while Chase can give you a general sense of where you stand, it’s not the score that determines your mortgage rate, car loan terms, or whether you qualify for a premium credit card.

Key takeaway: When it comes to loans, FICO rules. Chase is helpful for monitoring trends related to your credit score, but lenders will use FICO to determine your interest rate.

Return to FAQs

FAQ: How should I use the Chase credit score in my financial planning?

Use your Chase score as a general health check, not as the final word. If it trends upward, that’s a good sign your FICO is improving too. But if you’re planning a big financial step like applying for a mortgage, leasing a car, or opening a new credit card, always check your actual FICO first.

Return to FAQs

One age group stands out with the highest percentage of credit scores 620 or less, and it’s probably not the one you think. According to aggregated data from sources like CliffsNotes, ClassAce, and CourseSidekick, the biggest spike doesn’t happen at the beginning of adulthood. It happens later.

That surprised me… until I thought about what really happens during that stage of life. Bills pile up. Mortgages, student loans, kids, credit cards: All of it hits at once. It’s a pressure cooker.

So let’s take a closer look at what age group has the highest percentage of credit scores 620 or less, and more importantly, what you can do if your score is stuck in the low 600s … or lower.

What Age Group Has the Highest Percentage of Credit Scores 620 or Less?

If you’re wondering what age group has the highest percentage of credit scores 620 or less, it’s not the very young. It’s people in their 30s. Adults between the ages of 30 and 39 are more likely than any other age group to have a credit score of 620 or lower. While it’s easy to assume that younger adults would struggle the most due to limited credit history, the data tells a different story. The trend toward a lower credit score happens in the decade when financial responsibilities start compounding fast.

Here’s why this decade is the most credit-challenging:

• Big life expenses: Mortgages, student loan payments, car loans, credit
  cards, and kids. These pile up fast.
• Risky borrowing patterns: Entry into higher-limit cards and large loans can
  lead to missed payments or high balances.
• Lingering credit damage: Mistakes from your 20s may still be dragging down
  your score, and recovery takes time.
• Not enough time to rebuild: Unlike older adults, those in their 30s haven’t
  had decades to recover from credit missteps.

By contrast, people under 30 may have limited credit history, which does lower their score, but it also translates to fewer chances for serious damage, and people over 40 are often in the process of rebuilding or have already done so.

In your 30s, you’re often juggling student loans, car payments, mortgages, childcare, and credit cards, all while trying to build a stable life. It’s a lot. And when money gets tight, it’s easy for payments to fall behind, causing credit scores to drop.

Be sure to read this related article: “How Can I Improve My Credit Score Quickly?”

What Does a Sub-620 Credit Score Mean?

If you fall into the age group with the highest percentage of credit scores 620 or less, here’s what that means for your day-to-day finances:

• Mortgage limitations: Conventional home loans often require a minimum score of 620.
• High interest rates: Lenders may approve a loan, but at punishing rates.
• Loan denials: You may not qualify at all, especially for auto or personal loans.
• Increased fees and deposits: You might be required to pay security deposits for apartments, cell phones, or utilities.

In short, a low credit score makes everything more expensive, or unavailable altogether. By contrast, here’s what you can expect if you increase your credit score to 720:

• Lower interest rates:You’ll save thousands over the life of a loan.
• Higher credit limits: Lenders trust you with more borrowing power.
• Top-tier credit cards: Get access to cards with serious perks.
• Free travel: Use points and miles to cover flights, hotels, and upgrades.
• Cash-back and rewards: Earn money or points on everyday spending.
• Stronger approval odds: Qualify more easily for mortgages, auto loans, and rentals.
• Better terms: Enjoy lower fees, better insurance rates, and fewer security deposits.

Tips for Improving a Credit Score of 620 or Less

If your credit score is below 620, the 7 Steps to a 720 Credit Score free credit-education program can help you start turning things around today. Here are three tips from the course:

Keep Your Balances Low

Your credit utilization ratio, how much credit you’re using compared to your total limit, is one of the biggest factors in your credit score. The goal is to keep this ratio under 30%, but if you want to see real movement in your score, aim for 10% or less. That doesn’t mean you need to pay off your cards entirely. Just avoid letting balances creep too high.

Dispute Credit Report Errors

Mistakes on your credit report can drag down your score for years if you don’t catch them. And they’re more common than most people realize: Industry experts estimate that between 34% and 70% of reports contain at least one error. Check your report regularly at annualcreditreport.com, which gives you free access from all three bureaus. If you find anything that looks wrong, like a payment marked late when you know it wasn’t, dispute it in writing and follow up until it’s resolved. The 7 Steps program includes templates and step-by-step instructions to walk you through it.

Mix Your Credit Types

Credit scoring models reward variety. That means having both revolving credit (like credit cards) and installment accounts (like car loans, student loans, or credit-builder loans). If you only have one type, your score may be stuck, even if you’re doing everything else right. You don’t need to take on unnecessary debt, but adding a small, manageable installment account can give your score a helpful nudge.

Watch & Learn: Building Credit Through a Credit Rebuilder Program

FAQ

What does a credit score of 620 or less mean for your finances?

A credit score of 620 or lower can be a major barrier to financial opportunity. This is the cutoff that many lenders use to determine whether you qualify for loans, credit cards, and even rental agreements.

At this level, you’re in what’s often called “subprime” territory. That means even if you get approved for credit, it’s likely to come with high interest rates, low credit limits, or extra fees. For example, someone with a 620 score might qualify for a car loan with an 11% interest rate, while someone with a 720 score could get the same loan for under 6%. Over the life of the loan, that difference could cost you thousands.

You might also face added expenses like utility deposits, higher insurance premiums, or prepaid cell phone plans. In short, a low score makes everything more expensive. A low score also has an impact on your peace of mind. Many people report feeling stuck or ashamed, even when the low score came from events outside their control. But you’re not powerless. Credit scores are fluid, and with a focused credit rebuilding plan, you can climb out of the low-600 range in just a year or two.

How fast can you raise your credit score after it drops below 620?

With the right strategy, you can reach a 700+ score in as little as 12 to 24 months.
Credit scores are not fixed. They respond quickly to new behavior. The most important thing is to stop the damage and start showing positive activity. That means on-time payments, low credit utilization, and adding the right mix of accounts. Even one new positive tradeline (like a credit card or installment account) can begin moving the needle.

People often wait for the negative items to “fall off” their credit report, assuming that time alone will fix the problem. But that’s a mistake. A bankruptcy, for example, might stay on your report for up to 10 years, but your score can recover long before that. In fact, many participants in the 7 Steps to a 720 Credit Score program see dramatic changes in their scores within the first six months, especially if they follow the credit-building steps exactly.

The key is not waiting for time to do the work. Your score improves when you start taking action. And the sooner you do, the sooner your credit begins to reflect your current behavior, not your past.

Is it better to pay off old debt or build new credit when your score is low?

You need to do both, but when it comes to raising your credit score fast, new positive activity often has the biggest impact.

Here’s why: Credit scoring models place more weight on current behavior than on the past. That means if you’re only focused on paying down old debt, your score may not budge much, especially if that debt is already charged off or in collections. On the other hand, adding new accounts and using them wisely gives the credit bureaus something positive to report.

For example, someone with a 620 score who opens a secured credit card, keeps the balance below 10%, and makes on-time payments each month can start to see their score rise within a few billing cycles. And if they add an installment loan, like the one offered through the Credit Rebuilder Program, the impact can be even stronger.

That said, paying down revolving debt (like credit cards) is still critical, especially if your credit utilization is high. But the real key is balance: clean up what you can, and start building new credit at the same time.

Should I stop using credit and go cash-only?

No, and here’s why: You need credit to build credit.

It’s completely understandable to want to ditch credit altogether, especially if you’ve gone through a bankruptcy or struggled with debt. Going cash-only can feel like a fresh start. But over the long run, avoiding credit entirely can hurt more than it helps.

Here’s the deal: Your credit score is based on your use of credit. If you don’t have active accounts reporting to the credit bureaus, there’s nothing to measure. That means even if you’re financially responsible, your score can drop because there’s no recent activity to track.

Eventually, you’ll need your credit score, whether it’s for renting an apartment, buying a car, getting a mortgage, or even setting up utilities. If you’ve been off the grid for too long, you might face high deposits, higher interest rates, or outright denials.

The smarter move is to use credit strategically. That means opening the right accounts, using them for small purchases, and paying them off in full each month. This builds a strong credit history without getting you back into debt. Programs like the free credit-education program, 7 Steps to a 720 Credit Score, are designed to walk you through exactly how to do this.

Will paying off my collections help my credit score?

Not necessarily. A lot of people assume that once you pay off a collection account, your credit score will go up. But that’s not always how it works.

Here’s why: Once a collection shows up on your credit report, the damage is already done, and simply paying it off doesn’t erase the mark. That collection can remain on your report for up to seven years, whether it’s paid or unpaid. And many credit scoring models, especially the older ones, continue to factor it in even after it’s been paid.

Some newer scoring models ignore paid collections entirely, especially if they’re medical debts. But most lenders still rely on older models, so it’s hard to know if paying the debt will actually improve your score.

There’s another risk, too: If the debt is past the statute of limitations and you make a payment, you might restart the legal clock. That means the account could become collectible again or even show up longer on your report.

One possible workaround? Negotiate a pay-for-delete agreement. That’s when you ask the collection agency to remove the item from your report entirely in exchange for payment. It’s not guaranteed, and it’s discouraged by credit bureaus, but it does happen. If successful, it could raise your score by 50 to 100 points. (Step 6 of the 7 Steps to a 720 Credit Score, our free credit-education course, walks you through how to do this.)

Even if deletion isn’t possible, paying the debt can still bring peace of mind and prevent future collection efforts. But if your goal is to boost your score, the biggest gains usually come from building new credit habits: on-time payments, low balances, and responsible use of credit going forward.

More than 30 years ago, I started my career as a mortgage broker helping people make the biggest purchase of their lives: buying a home. I seemed like I had it all together… but I walked into the bank one day, and reality hit me hard.

“You’re overdrawn!” the teller said, not exactly in a whisper.

I looked around, hoping no one recognized me. Here I was, supposed to be the expert, and I had negative $12 in my account.

Then she asked if I wanted to apply for overdraft protection. Of course I said yes.

And then came the real gut punch…

“You’ve been denied.”

I was broke. I had bad credit, and I felt like a fraud.

That moment stuck with me. I kept thinking, How can I fix this? How can I improve my credit score quickly?

So I started digging. I studied credit reports, talked to experts, and read everything I could get my hands on. Slowly, my score climbed. And eventually, I put everything I learned into a system, something simple and step-by-step.

That became 7 Steps to a 720 Credit Score, first a book, then a course. It’s now helped more than 200,000 people rebuild after setbacks like bankruptcy, divorce, job loss, or just plain life.

If you’re wondering—How can I improve my credit score quickly? —then this is a great place to start. I’ll share with you some of the best tips out there for moving the needle.

While you are at it, take advantage of our limited offer to enroll in our credit-education course for free!

FAQ: What’s the fastest way for someone to raise their credit score?

Answer: It really depends on your credit history, so let me give you a few examples that might be relevant to your specific credit profile.

Joshua was one of our students, and when he started the course, his score was low, not because he had any financial upsets, but because he didn’t have much credit to begin with. That’s common. When the credit bureaus don’t see much history, they get nervous. Their job is to guess how likely you are to miss a payment in the next 24 months, and if they don’t have much data to go on, they tend to play it safe and assume the worst.

Joshua’s score was 589, which is way too low to qualify for the best interest rates, much less get approved for some apartments.

So here’s what we told Joshua:

If you don’t have much credit yet, one of the fastest ways to boost your score is to become an authorized user on someone else’s credit card. That means you piggyback on their account and get the benefit of their payment history, without taking on their debt.

But here’s the catch: the account needs to be in great shape. That means the person pays on time, keeps their balance low (ideally under 30 percent of the credit limit), and has had the card open for a while.

Joshua added himself as an authorized user on three of his parents’ cards, cards they had managed well for years. And the result? His score jumped 107 points.

It’s one of the quickest wins we’ve seen for people who are just getting started.

Now let’s look at another example…

Alana came to us after filing for bankruptcy. Her credit score was low (607), but when we looked closer, we found something that made a big difference: Several of her old accounts were still being reported as active, even though they should have been cleared in the bankruptcy. Since no payments had been made on those accounts, they were showing up as severely past due.

That kind of reporting error can drag down a score fast.

We helped Alana file disputes to clean up the mistakes, and once those errors were removed, her score jumped from 607 to 672. That wasn’t quite high enough to unlock the best interest rates, but it moved her out of the “poor” category and into the “fair-to-good” range. And with a few more smart moves that she learned from our free credit-rebuilding program, she hit 720 just nine months later.

Watch & Learn: How Can I Improve My Credit Score Fast?

Here’s one more example, this time from someone with a different kind of credit challenge.

Leo wasn’t behind on any of his bills. He had a few dings over the years, but he paid on time most of the time. But his credit score was still stuck, and when we looked closer, we saw why: nearly all his credit cards were maxed out or close to it.

That’s a big red flag in the credit world. Even if you’re making payments, high balances can drag down your score. It tells lenders you might be overextended or struggling to manage your finances.

So here’s what we told Leo:

Do whatever you can to bring those balances down. The general rule is to keep your credit card usage under 30 percent of your limit. So if you have a $1,000 limit, aim to stay below $300. If 30 percent feels out of reach, shoot for 50 percent to start. And if you can get it down to 30 percent, don’t stop there: Getting it under 10 percent is even better.

Leo got serious about it. He trimmed his spending, made extra payments, and chipped away at those balances week by week. And the results were worth it: once his utilization dropped below 10 percent, his credit score jumped 118 points.

FAQ: Is it true that paying off collections helps your credit score?

Answer: Not always. It’s a common assumption that paying off a collection account will automatically boost your credit score, but that’s not how it usually works.

Here’s the deal: Once a collection is on your credit report, it can stay there for up to seven years, even if you pay it off. Just making a payment doesn’t erase it. And depending on which credit scoring model a lender uses, that paid collection might still hurt your score.

Some newer models like FICO 9 and VantageScore 4.0 ignore paid collections, but older models, including the widely used FICO 8, do not. So unless you know which model is being used, it’s hard to say whether your payment will make a difference.

There’s another layer to this. When you make a payment on an old collection, especially one that’s past the statute of limitations, you might restart the clock. That means the debt becomes “active” again and can stay on your report longer or even open the door to legal action.

But there’s a smart workaround: negotiation. In some cases, you can talk to the collection agency and ask for a pay-for-delete agreement. That’s where they agree to remove the account from your credit report entirely in exchange for payment. While credit bureaus officially discourage this practice, some collectors will still honor it, especially if you get the agreement in writing. When it works, a pay-for-delete can lead to a major score jump, sometimes 50 to 100 points or more.

We discuss this strategy in Step 6 of our free credit-education course. 

If deletion isn’t an option, paying the collection still has some benefits. It can stop collection calls, reduce stress, and show future lenders that you’ve taken care of your obligations. Just know that in terms of credit score improvement, the real wins come from either removing the collection or building new, positive credit behavior, like paying your current bills on time, lowering your credit card balances, and avoiding new hard inquiries.

FAQs