5 Ways you are Killing your Credit Score

I know you are thinking, Tia, not another post on credit!  Yes, there have been quite a few posts on credit lately.  However, your credit score is so important.  It can affect if you are able to buy a house or car as well as the interest rate or total amount that you will pay for that house or car.  Literally, with a poor credit score your car payment could be over $500 and with an excellent credit score, that same car payment would only be $350 (or less).  In this post, I want to make sure that you’re not killing your credit score.

Before we dive into the 5 ways that you are killing your credit score, let’s look at the different categories that make up your credit score and their weightings.

  • Payment History: 35%
  • Credit Utilization: 30%
  • Length of Credit History: 15%
  • New Credit: 10%
  • Credit Mix: 10%

Now that we have reviewed the categories that make up your credit score and their weightings, let’s look at the 5 ways you are killing your credit score.

5 Ways you are Killing your credit score

High Credit Card Balances

The first way that you are killing your credit score is by having high credit card balances.  Credit Utilization makes up 30% of your credit score! Credit Utilization is the percentage of total credit that you have access to divided by how much you have borrowed.  Ideally, your credit card utilization should be under 30% or lower.

Take a look at these credit utilization examples:

  • Let’s say you have a credit card with a limit of $1000 and you carry a balance of $600.  Then your credit utilization would be 60%.
  • If you actively paid the credit card with a limit of $1000 down to $300, then your credit utilization would be $30%.

Excessive Amount of Inquiries

The second way that you are killing your credit score is by having an excessive amount of inquiries.  Inquiries occur when a legitimate business checks your credit report.  Credit inquiries fall into 2 categories: hard and soft inquiries.  Only hard inquiries have an effect on your credit score and these typically happen when a lender is checking your credit worthiness when making a lending decision.  This often happens when applying for a credit card, car loan, personal loan or student loan (among other things).

We all may need to apply for new credit at some point.  It is just important to not have too many hard inquiries on your credit report in a short amount of time.  It takes 2 years for a hard inquiry to fall off your credit report so think before applying for new credit.  Typically, though, you are not punished for shopping around for the best interest rate in a short amount of time (i.e. if you are shopping for a mortgage and get quotes from different lenders within a 2 week period).

Ignoring Creditors

Have you been ignoring those random numbers calling your phone?  Sometimes those random numbers calling you have gotten the wrong number but other times it is a creditor trying to get ahold of you.  I am here to tell you, stop ignoring creditors!

First of all, you can’t fix a situation if you are in denial.  Secondly, depending on what company is calling you there may be solutions to resolved the situation.  For example, if a student loan servicing company is calling you there may be special repayment options based upon your situation.  If you always ignore the calls, then you will never get the help that you need.

5 Ways you are Killing your Credit Score

Past Due Payments

The fourth way that you are killing your credit score is by making late payments.  Payment history is the highest weighted section when calculating your credit score.  Lenders want to have faith that if and when they extend you credit, they will receive on time payments.

Your payment can not be reported late to the major credit bureaus until it is at least 30 days late.  However, you are playing with fire if you always wait until your bills are 29 days late to pay them.

  • When a payment is late 30-60 days, it typically only hurts your credit score in the short term.
  • When a payment is more than 60 days late, it can effect your credit score much longer.  In fact, it can effect your credit score up to 7 years.
  • In addition, once a payment becomes more than 120 days late, the debt can lead to being in collections or even charged off which has an even greater effect on your credit score.

Not Checking Your Credit Report

A major way that you could be killing your credit score is not checking your credit report all together!  It is important that you check your credit report at least once a year and not just when you are in the market for new credit.  Speaking as a victim of identity theft, I check my credit report at least 3 times a year if not more than that.

Personally, I check my credit report from Annual Credit Report.  Annual Credit Report is the only website authorized by federal law to provide you with a copy of your credit report. You are able to get a copy of your credit report from each of the 3 major bureaus (Transunion, Experian, and Equifax) once per year.

Related: The Only Way to Get your Free Credit Report


Check out these other hot posts on credit:


Education is key because you could be killing your credit score without even realizing it!  What things have you done in the past (or still do) that is killing your credit score?


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  1. I used to ignore creditors in the past. I was young and dumb. When I decided to get my finances right, I called a couple of them. They were able to help me set up payment plans that helped me get current. Doing that helped me get n track.

  2. I think credit utilization is the most overlooked or unknown factor in the credit score calculation. Most people think it’s ridiculous to have a higher credit card spending limit, but I love it because it lowers my utilization ratio. As long as you can keep your spending in check, higher limits are a GOOD thing – thanks for highlighting this!

  3. Good informative post. Thanks for sharing. Building Good Credit Early interestingly will take persistence and teach. Making your credit installments on time is one of the greatest contributing elements surprisingly scores.

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