When Creditors Report to the Bureaus

One of the most frequently asked questions we get regarding credit reports is: “When do creditors report to the bureaus?” There is a misconception that creditors report their information at the beginning of every month and that credit reports update at that time as well. But in the world of credit reporting that would make things too simple! It is, in fact, a bit more complicated than that.

Creditors don’t actually have to report to the bureaus at all. It is their prerogative to do so and there are some that don’t. Usually those would be smaller banks or credit unions. When they do, they may decide to report to only one bureau or not at all. Even some larger companies that do regularly report to the bureaus may stop reporting an account for one reason or another. For example, if you file for bankruptcy your mortgage company may stop reporting your history and monthly payments, even if your mortgage was not part of the bankruptcy or was reaffirmed. The same is true if you are under a loan modification program with your mortgage company. It is not mandatory that any creditor report to the bureaus.

When a creditor reports is also at their discretion. Some report at the beginning of the month, some in the middle, some at the end, some twice a month, some every month, etc. Because of this scores can literally change daily. Your credit scores are a “snapshot” at any given moment and are subject to change the very next moment depending on when information updates.

This can be very frustrating for a consumer who thinks they should have very high credit scores because they pay their bills on time and pay them off every month. The truth is that if you have, for example, a high balance on a credit card that you pay off every month but you pay it off after that creditor reports to the bureaus it will show up on your credit report with the high balance. If that balance is close to the credit limit it can hurt those scores further. The best answer for this is to be sure to always keep any revolving balances below 20% of the high credit. This isn’t always possible so just be aware that if your credit is pulled and shows balances that in reality are paid off, it’s just because the creditor has not yet reported the new information to the credit bureaus.

Regarding newly opened accounts, the timing of when these accounts start reporting to the bureaus can also be aggravating for someone who is trying to establish credit or has a thin file and is trying to generate scores. When a consumer first opens a credit card account the creditor will typically report the new card thirty days after you make your first payment. The best thing to do when you get a new credit card is to use it immediately and then make a payment on it as soon as possible. The sooner the payment is made, the sooner it will report. This is not an absolute for all credit cards but it is the way the majority of them work.

Trying to second guess when a creditor is going to report is pretty much next to impossible. You can always call and ask them when they report but they may or may not tell you. Also keep in mind that if they do tell you, it may not be correct. Just know that eventually your information will be updated on your credit report but that it’s going to depend on when each creditor sends their information to the credit bureaus. So when you look at your scores and you see them possibly change several times a month, don’t be surprised. Scores can change daily whether we like it or not.

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