What Is: A Credit "Rescore"

A credit rescore is a process that allows a lender to update and potentially improve a borrower's credit score in a relatively short period. It's typically used when there are errors on a credit report or when the borrower has taken specific actions, such as paying off a debt, that could positively impact their credit score.

Here's how a credit rescore works:

1. Identifying Errors: If there are errors on your credit report that are negatively impacting your credit score, such as an account that doesn't belong to you or a late payment that was incorrectly reported, you can dispute these errors with the credit bureaus.

2. Submitting Documentation: To initiate a credit rescore, your lender will submit documentation to the credit bureaus supporting the changes that need to be made. This could include proof of payment for a debt that has been satisfied or documentation showing that an account was opened fraudulently.

3. Bureau Investigation: Once the documentation is received, the credit bureaus will investigate the dispute and make any necessary updates to your credit report.

4. Updated Credit Score: After the credit bureaus have made the updates to your credit report, they will recalculate your credit score based on the new information. If the updates result in a higher credit score, your lender can use this new score to reassess your loan application.

It's important to note that not all lenders offer credit rescoring services, and there may be fees associated with the process. Additionally, a credit rescore is not a quick fix for poor credit habits. It's always best to manage your credit responsibly by paying your bills on time, keeping your credit card balances low, and only applying for credit when necessary.