A late payment or account in collections can quickly drag down your credit score. Paying off debts and closing any delinquent accounts improves your score but the negative entry does not disappear immediately. Bankrate.com, a personal finance website, claims that most reports are updated within two billing cycles, or about 60 days. Individuals can also pay off a debt and call the lender to ask for rapid rescoring.
Credit Report
Your credit score comes from your credit history as reported in your credit report. Creditors and lenders opt to report your activity with them to credit rating agencies, which compile the activity into a report. Creditors can be anyone from collections agencies, your bank or credit card company, who almost always report activity, to your dentist or grocery store, who rarely report activity.
Regular Updates
The credit rating agency Experian, one of the three main agencies, said it receives information from public and private sources on a regular basis. However, the frequency of reporting varies from entity to entity and can be anywhere from daily to quarterly; your company can take up to three months to report new information. The agency states that once it receives new information, the information is processed, filed and reflected in individual credit reports within 72 hours.
Rapid Rescoring
Bankrate.com suggests that individuals wishing to raise their credit scores quickly pay off debts and then pay for rapid rescoring. Rapid rescoring sends updated information to credit agencies and refigures your credit score in a matter of days. However, your credit card company, bank or other lender must be a customer of a rapid rescoring service and will most likely pass on the cost of the service to you, which Bankrate.com reports runs around $50 per account.
Calling
A cheaper way to update your credit report is to call your lender and ask about their reporting practices. You can request that your lender update an account as soon as the payment is received, though the company is under no obligation to do so. You can even ask the company (especially a collections agency) to remove the account from your report once you pay. However, it is ultimately up to the company to decide whether to help you or continue with its routine reporting practices.
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