Having good credit may give you more opportunities, but it doesn’t make you invincible. There are all kinds of unexpected ways that your good credit score can go down in a heartbeat.
Here are 10 things you may not have known could hurt your credit score:
1. Just one late payment
You may have found the best credit card for good credit, but if you make even one payment more than 30 days late, your credit score may suffer. That’s when credit card issuers are likely to notify credit-reporting agencies of your delay, and that can drop your score.
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It’s not just late payments on credit cards that can affect your credit. Late payments on utilities, rent, phone or loans can have a negative impact as well.
3. Applying for more credit
Every time you ask for credit — everything from applying for a mortgage to a store credit card — a hard credit inquiry is made on your account. Every hard inquiry affects your credit score, even when you don't get approved.
Even if you’ve paid off a credit card, hold onto it. Canceling a credit card can hurt your score two ways: It reduces your total credit amount, which can raise your credit utilization ratio. It also can shorten the age of your credit history.
5. Transferring balances to a single card
Carrying only one card around may be convenient, but transferring your balances to a single card may not be beneficial to your credit. Creating one high balance that approaches your credit limit sends your credit utilization way up, which will hurt your score.
Get more financial clarity with NerdWallet
Monitor your credit, track your spending and see all of your finances together in a single place.
Whenever you co-sign with your good credit to help out family or friends with less-than-perfect credit, you take on responsibility for their debt. If they can’t pay, you’ll have to — or your good credit will suffer the consequences.
7. Not having enough credit diversity
Your credit score isn’t just made up of your history with one credit card. Having a mix of credit types — revolving and installment — can help your score.
8. Holding high credit card balances
If your balances are creeping up toward your credit limit, it can hurt your good credit. Try to keep your credit utilization ratio around 30% of your available credit — and the lower the better.
It’s a myth that unemployment claims will hurt your good credit; not being able to pay your bills will. Talk to your creditors before you miss payments to try to alleviate potential effects on your accounts.
10. Ignoring your credit report
You can get free credit report information from NerdWallet. Use that access to monitor for potential errors that could end up hurting your credit score. If you see something that doesn't add up, you can request free weekly in-depth reports from the three credit reporting agencies: Experian, TransUnion and Equifax.
Checking your credit score on NerdWallet only prompts a soft inquiry on your credit report - not a hard inquiry - and will never impact your score in any way, no matter how often you check it. This article includes more detail about this: Does Checking My Credit Score Lower It?
Checking your credit score on NerdWallet only prompts a soft inquiry on your credit report - not a hard inquiry - and will never impact your score in any way, no matter how often you check it. This article includes more detail about this: Does Checking My Credit Score Lower It?
1. Payment History: 35% Making debt payments on time every month benefits your credit scores more than any other single factor—and just one payment made 30 days late can do significant harm to your scores. An account sent to collections, a foreclosure or a bankruptcy can have even deeper, longer-lasting consequences.
Your score falls within the range of scores, from 580 to 669, considered Fair. A 629 FICO® Score is below the average credit score. Some lenders see consumers with scores in the Fair range as having unfavorable credit, and may decline their credit applications.
Consider whether your primary concern is tracking your finances or managing your credit score. Credit Karma is likely the best option for you if your primary concern is managing or improving your credit score. If your primary concern is budgeting and finance tracking, NerdWallet is likely the better choice.
Something that is really easy to do, but can really hurt your credit rating is to make late payments. It might seem harmless to pay off your card a couple of days late, but it can make a big impact.
While the term “deadbeat” generally carries a negative connotation, when it comes to the credit card industry, you should consider it a compliment. Card issuers refer to customers as deadbeats if they pay off their balance in full each month, avoiding interest charges and fees on their accounts.
When your credit card bill arrives, you either choose to make just the minimum payment or it is all you can afford to pay at the time. You figure you'll pay off the rest when your finances improve. Soon, you're in the trap of pulling out your card whenever you want to purchase something beyond your budget.
Using more of your credit card balance than usual — even if you pay on time — can reduce your score until a new, lower balance is reported the following month. Closed accounts and lower credit limits can also result in lower scores even if your payment behavior has not changed.
Various weighted factors mean that even with no credit, your credit score could still be low because the length of your credit history or credit mix, for example, could also be low.
We use industry-standard security controls, such as cryptography, to protect your personally identifying information. And our partners TransUnion and Plaid do the same.
And we use a "soft inquiry" so checking your score won't hurt it. Where does NerdWallet get my score? NerdWallet partners with TransUnion® to provide your VantageScore® 3.0, based on information in your TransUnion® free credit report.
We may share information collected directly from you with unaffiliated third-party partners in connection with your use of specific aspects of the Services. Some examples include but are not limited to: When you request to prequalify for a third-party loan or credit card product on NerdWallet Services and.
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