Money Talk with Marie
Hello, Marie! I have excellent credit, yet my credit score went down. Why?
July 25, 2016 | WMFA
Marie: There are various reasons why your credit score may have gone down:
Have you missed any payments? Late payments, collection accounts, settled accounts, repossessions, foreclosures, and public record items (tax liens, judgments, bankruptcies) can have a major negative impact on your credit score. Even minor late payments, such as 30-day delinquencies, can negatively affect your score. Your payment history makes up the largest part of your credit score, so the longer you pay your bills on time, the better your credit score.
Have you closed any credit card accounts, increased any credit card balances, or had any credit limits reduced? Any of these events can result in an increased proportion of credit card balances to available credit, which can lower your credit score.
Have you applied for or opened any new accounts lately? Establishing a new credit account can be an indicator of increased risk and can reduce your credit score.