How to improve payment history on your credit report

improve payment history on credit report

You can improve your payment history by signing up for automatic payments, setting up text or email reminders, or making weekly payments. 

Many people make late payments on their loans. In fact, 6.3 million Americans are 90 days late on their auto loan payments!1 But there are ways to improve your finances! Keep reading for more information on making the changes you need to improve your payment history. 

How Do Payments Show Up on My Credit Report?

Suppose you don’t already know how your credit report works. In that case, it will be helpful to have that information before tackling payments. Your credit history (credit accounts, their balances, and payments) will make up your credit report. 

Whenever you take out a loan or a credit card, the lender will report its origination to the three major credit bureaus for American consumers. These credit bureaus are: 

  1. Equifax 
  2. TransUnion 
  3. Experian 

Once repayment starts, your lenders will also report each payment you make. These details include the payment amount and the dates you make a payment. Any changes to the outstanding balance will also be reported. 

Lenders send that information to the credit bureaus. These bureaus then add that information to your credit report. This is where information on missed payments or on-time payments is reported. For purposes related to your credit report, a late payment is considered a payment made 30 days after its due date. 

Your credit report and all its information are used by the bureaus to compute a credit score. Payment history makes up 35% of credit scoring—the highest percentage compared to other factors used in a credit score algorithm. And so, it’s crucial that you try and avoid late payments. 

Having even a few late payments on your credit report will negatively impact your credit score for up to 7 years! While having on-time payments will create a positive payment history. 

Why Is It Important To Have Good Credit History and a Positive Credit Score?

Your fico score or credit score will impact various aspects of your life. The obvious one is loan and credit card options. Lenders will check your credit report when you apply for credit. With a good credit score, you increase chances for approval and potentially get better rates and higher loan amounts. Additionally, you could have access to a variety of financial services and financing options. 

It is vital to understand that bad credit can keep you from getting a job, good housing, and more. Having a great FICO score can improve your employment opportunities, lower your living costs, and improve your overall quality of life. 

What Kinds of Payments Show Up on Credit Reports? 

Not all your monthly payments for bills show up on a credit report. Although paying all your bills on time is always a great idea! Below are the most common examples of debts and their payment histories that will be reported to the credit bureaus:

Revolving Debt

Revolving debt encompasses any credit account you can borrow from as you repay it. Credit cards are one of the most used forms of revolving debt. Any late payments will be reported by your credit card companies. 

Installment Loans

Installment loans offer borrowers a steady monthly payment until the loan is paid off in full. Payments for these loans will also show up on your credit reports and impact your credit score. 

Personal Loans

Personal loans can vary in size, use, and eligibility requirements. Regardless of what you use a personal loan for or how much you are borrowing, your credit reports will have their origination, balances, and payment history.

In-Store Financing

In-store financing is offered by many retailers, manufacturers, and car dealerships. Although retail accounts may not seem like something that will impact your credit score, they will, in fact, affect your payment history.

Student Loans

Both federal and private student loan payments will impact your payment history. 

Auto Loans

Auto loans can be available through dealerships, car manufacturers, retailers, or private financial institutions. Regardless of where you borrow from, lenders will report your payment history with a car loan. 


Mortgages are another type of loan that will show up on a credit report. Any on-time payments and late payments will affect your credit. 

Rent payments (usually), phone bills, some utilities, and streaming service subscriptions are all examples of debt not reported to the credit bureaus. Consequently, your payment history on these accounts will not impact your credit score. 

However, suppose you are building your credit history or improving your credit score. In that case, credit bureaus offer the ability to add these types of payments to your credit report. That way, you don’t have to rely heavily on applying for no credit check loans or bad credit loans to build or improve your credit rating. For example, Experian has Experian Boost, allowing users to use everyday payments as credit history. 

Fix Errors on a Credit Report (If Any) For a Better Payment History

Regularly checking your credit report is critical to spot things like fraud or simple errors, which do happen. Errors on your credit report can make it look like you have missed payments or outstanding credit balances that aren’t there. In other cases, it can alert you to someone using your identity without your knowledge to take out online loans or credit cards. 

The first step to fixing any errors is starting a dispute with the responsible credit bureau(s). There are several ways to file a dispute. You can mail a letter, contact them online, or by phone. Credit reporting agencies must investigate any disputes or claim them as frivolous. 

If the credit bureau determines that the information on your credit report is accurate, they will send you a statement with supporting documents with the details on the account. 

Change the Way You Make Your Payments To Improve Payment History

Now that you understand how payments show up on credit reports and how to fix any errors, you can begin to put in the work to improve your payment history! Here are some strategies to help prevent late payments: 

Automate All Your Payments To Avoid Late Bill Payments

One of the easiest ways to make on-time payments is to automate bills. You can automate payments for credit card debt, student loans, car loans, personal loans, installment loans, and utility bills . Set up automatic payments through each financial institution’s website or app with your checking account information. Once set up, automatic payments usually begin in 30 days. 

Be Aware of Minimum Payment Amounts!

A minimum payment for a credit card or loan payment is the required monthly amount you need to pay. And knowing exactly how much you owe is critical when improving your payment history. This is because if you don’t pay enough to cover the required payment, and it’s been more than 30 days, the remaining balance will count as a late payment. Although installment loans don’t change in their monthly payments, revolving credit can vary depending on usage, and loans with variable interest can change throughout repayment. 

Set Reminders for Yourself To Improve Payment History and Credit Score

Another way to remember your monthly debt payments is to set simple reminders for yourself. You can set reminders on your phone, in a calendar, or as a part of your budget. You can even keep it as simple as notes in a common area you see every day. With most lenders and credit card companies, you can set up an email reminder a few days before a payment is due, along with another email on the actual due date.

Pay Your Bills With Your Own Routine To Build a Strong Payment History

Routines are beneficial for those who are forgetful or simply tend to ignore reminders. Allocating some time the same day each month or during a payday are examples of simple routines that can be a great way to establish patterns. Once you get a good hold of a routine and payment schedule that works for you, it can help you avoid unpaid bills and improve your payment history. 

Consider Debt Consolidation for One Single Payment 

Debt consolidation is the process of rolling multiple debts into one loan—using a debt consolidation loan. Ideally, this new loan will lower high credit card balances and other debt payments with high-interest charges. In addition to lowering the interest rates, you will only have to focus on one due date and payment, reducing the chances of a missed payment.

CreditNinja: The Bottom Line on How To Improve Your Payment History Today

No matter how many late payments you have made in the past, it’s never too late to start making payments on time! Using a combination of strategies and tools, you are likely to find a personalized solution that works for your situation. With on-time payments, you’ll see an improvement in your credit score, which is an essential part of becoming financially stable!

And if you ever need a 400 dollar loan due to an emergency, apply with CreditNinja! We offer quick financial solutions to a wide variety of consumers! Check out our customer reviews to see for yourself why we remain one of the top online lenders.  


  1. 6.3 million Americans are 90 days late on their auto loan payments | Washington Post
  2. How to Improve Your Payment History | Experian
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