If you’re on a journey to improve your credit score, one of the best ways to do so is by paying off your credit card debt. However, paying off a credit card does not instantaneously boost your score, as this time frame depends on both the card issuer and the credit bureau. 

It may take a few weeks, or up to three months, for your credit score to update once you pay off your credit card balance. This is because the frequency at which your credit score changes depends on both when the card issuer reports your payment behaviour to credit bureaus, and when the credit bureau updates your credit file. 

If you’re working to boost your credit score as quickly as possible to apply for a credit product, like a home loan or personal loan, it’s worth keeping in mind that this process will take time to create results. It may be worth beginning this process at least two to three months before you want to apply for this new credit product. 

How often do banks report your payment behaviour to credit bureaus?

In Australia, there are three major credit reporting bureaus for consumers; Experian, Equifax and illion. Generaly speaking, it has been suggested that creditors, like banks and credit card issuers, report to the major credit bureaus every 30-45 days. 

How often do credit bureaus update your credit score?

Unfortunately, no one knows how often the major credit bureaus change or update your credit score. Nor do we know the exact metrics of how they analyse and grade your credit score based on your credit history.

There is a general pattern of payment behaviour that credit bureaus will look at, including:

• Credit products you’ve applied for;
• The credit limit of each product;
• Old information that has been removed from your file;
• The age of information on your files (if a negative event occurred many years ago, it may no longer be weighted as heavily against your score);
• Updates to the algorithm made periodically;
• The types of credit providers that have made hard enquiries on your account; and
• Any negative events, such as defaults.

The credit bureaus will generally take a snapshot of your financial data at different time frames. Understandably, they cannot do this every day for every single Australian. 

As you may request a free copy of your credit report once every three months, it may be safe to suggest that your credit file is updated at least once every three months. 

How long does it take for your credit score to change once you pay off a credit card?

So, how long does it take to see your credit score change once you’ve paid off that pesky credit card debt? In a best case scenario, it may only take a few weeks, or a month, from the time your issuer reports your behaviour to a credit bureau for the bureau to update your credit score. In a worst case scenario, it could take three or more months.  

The truth is that the frequency of when credit bureaus update your credit score is simply not public knowledge. What we do know is that one of the easiest ways to keep on top of your credit score, and monitor for any changes, is to use a credit score checking platform, such as the free Credit Score app offered by RateCity.

Take the guesswork out of boosting your credit score. You’ll be notified when your credit score changes with Experian and Equifax - two of the biggest credit bureaus in Australia - through the RateCity Credit Score app.

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