Get updates delivered to you daily. Free and customizable.
GOBankingRates
3 Red Flags That Indicate Your Credit Score Is Going To Drop
By Cameron Diiorio,
17 days ago
Michael Krinke / Getty Images/iStockphoto
Your credit score affects everything from your ability to borrow money to renting an apartment to getting insurance. But keeping up with all the factors that impact your score can be a daunting task. Miss one, and you could see your score drop.
Another red flag that your score is about to drop is that you recently paid a bill late or skipped a payment altogether.
“Late payments typically appear on credit reports when an account is 30 days or more past due,” according to Capital One. The derogatory information can stay on your credit report for seven years, although the impact on your credit score lessens in time.
It’s essential that you put aside enough funds to make at least the minimum payments on your credit cards each month. If you’re prone to forgetting to pay, set reminders for yourself, or put your accounts on autopay.
Canceling a Credit Card
If you had more credit cards than you needed, you might’ve canceled one you weren’t using. This is a potential red flag that your score is about to drop.
Your credit score is based in part on the average age of your credit accounts, according to Capital One. Closing an older card could reduce that average and cause your score to drop.
Canceling cards also reduces the amount of credit you have available — which, in turn, increases your utilization rate, which has a negative impact on your credit score.
If you feel like you really need to cancel a card in the future, eliminate a newer one or one with a low credit limit.
Get updates delivered to you daily. Free and customizable.
Welcome to NewsBreak, an open platform where diverse perspectives converge. Most of our content comes from established publications and journalists, as well as from our extensive network of tens of thousands of creators who contribute to our platform. We empower individuals to share insightful viewpoints through short posts and comments. It’s essential to note our commitment to transparency: our Terms of Use acknowledge that our services may not always be error-free, and our Community Standards emphasize our discretion in enforcing policies. We strive to foster a dynamic environment for free expression and robust discourse through safety guardrails of human and AI moderation. Join us in shaping the news narrative together.
Comments / 0