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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.
Have you ever wondered why your credit score isn’t as high as you’d like it to be? Well, get ready as we examine the two main factors that can cause your score to drop like a hot summer day’s ice cream cone.
1. The Late Payment Pitfall: This one’s a no-brainer, folks. A single day’s late payment can have a negative impact on your credit report, similar to a permanent marker stain on your beloved white shirt. And guess what? This stain doesn’t fade easily. Indeed, a solitary overdue payment can linger on your credit report for as long as seven years, akin to a persistent ghost refusing to leave your attic.
2. The Credit Utilization Conundrum: Picture this: you’re on a shopping spree swiping your credit card like there’s no tomorrow. But little do you know you’re actually digging yourself into a financial black hole. That’s because maxing out your credit cards or even coming close to it can seriously damage your credit score. It’s like trying to squeeze a watermelon into a shoebox – it just doesn’t work.
So. how can you dodge these credit score assassins?
For the Late Payment Pitfall: Set reminders, automate payments, or even better, pay your bills early. Think of it as a pre-emptive strike against the credit score monster.
For the Credit Utilization Conundrum: Resist the urge to become a credit card warrior. Aim to keep your credit utilization below 30%, like a cool cucumber under pressure. And if you’re feeling overwhelmed by your current credit card debt, consider consolidating it into a lower-interest loan.
Remember, a healthy credit score is like a golden ticket to financial freedom. It opens doors to lower interest rates, better loan terms, and even dream jobs. So, don’t let these two common mistakes sabotage your financial future. Take control of your credit score today and watch it soar to new heights!
Bonus Tip:
Experian Boost: This free tool lets you add positive payment information from your utility and phone bills to your Experian credit report. It’s like giving your credit score a little boost of energy, like a shot of espresso for your financial well-being.
Now go forth and conquer the world of credit scores!
Not paying ALL of your bills on time
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.
Co-signing credit applications
You assume liability for debts owed by family members or friends when you co-sign with your excellent credit to support them. If they can’t pay, you’ll have to — or your good credit will suffer the consequences.
4 Habits That Will RUIN Your Credit Score
FAQ
What are 5 things that can hurt your credit score?
What hurts credit score the most?
What are 2 things you might do that will lower or negatively impact your credit score?
What has the 2nd largest impact on your credit score?
What mistakes can hurt your credit score?
Hard inquiries, missing a payment and maxing out a card hurt your credit score. But there are other mistakes that can really tank it. Here’s what to avoid. The content on this page is accurate as of the posting date; however, some of our partner offers may have expired.
What are the top 5 credit score factors?
The five main factors that affect your credit score are : 1.**Payment history**: This is the most important factor that affects your credit score, accounting for **35%** of your score. It
Do credit inquiries hurt your credit score?
Soft inquiries, like those that come from checking your own scores and some loan or credit card prequalifications, don’t hurt your scores. Hard inquiries, when a creditor checks your credit before making a lending decision, can hurt your scores even if you don’t get approved for the credit card or loan.
What factors affect your credit score?
Here are the five biggest factors that affect your score, how they impact your credit, and what a credit score means when you apply for a loan . Payment history, debt-to-credit ratio, length of credit history, new credit, and the amount of credit you have all play a role in your credit report and credit score.