Why did my credit score drop?

Home Forums Credit Reports & Scores Why did my credit score drop?

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    Jordan Moore
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    #8755
    Team StellarFi
    Keymaster

    Fluctuations and differences in your credit score are a normal part of credit transactions. A drop in your credit score is not always a bad thing. Here are some reasons why your credit score may have dropped:
    Late or missed payments: Late payments show up on your credit report if it has been more than 30 days past the due date. It is the most important factor, determining 30% of your FICO® score.
    New credit card or loan applications: New credit applications result in hard inquiries which can knock off a few points from your credit score temporarily. This is nothing to worry about. But if you apply for several credit accounts at the same time, it can negatively affect your score more significantly.
    High credit utilization: Maxing out your credit limit by making large purchases and maintaining large balances on your credit card can negatively affect your credit score since it is the second most important factor in your FICO and other scores.
    Credit card closure, foreclosure, bankruptcy, or inaccurate information on your credit report are some of the other smaller, or less common reasons you might see a drop in your credit score.

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StellarFinance, Inc. and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.

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