When you see a score drop that means something within the scoring calculation has registered recently updated information to deliver the new score.
Ask yourself a few questions about your recent credit activity:
- What is your current credit card balance? It’s recommended that you keep your credit card utilization below 30 percent on each card.
- Have you recently applied for a mortgage, loan, or new credit card? One or two will likely not impact your scores significantly, but having several loan inquiries can cause your scores to dip. Lenders may also interpret this activity as an attempt to overspend.
- Is inaccurate information appearing on your credit report? If something inaccurate is showing up on your report, this could be an indicator that a lender has reported something incorrectly, or that you have been the victim of identity theft.
- Have you missed any payments or had an account sent to collections? Missed payments can have a large impact on your scores. If you are more than 30 days late on a payment, your credit scores will likely take a hit
- Did you close a credit card you’ve had for a while? Pay off the credit card and leave the account open to keep the positive points for history, longevity and total available credit.