The Most Common Credit Issues

Negative remarks on your credit report cause your check my credit score to go down. Many things can negatively affect your score, but these are some of the more common things.

#1 - Late Payments

Payment history accounts for 35% of your total score. This means late payments have a large negative impact on the total score. A payment more than 30 days past due is considered late and a negative mark is made on the credit report. A single late payment will only impact your score by a little bit. Repeated late payments will hurt your credit score quite a bit.

#2 - Large Amount Of Debt

Having too much debt is a very common credit problem. It's the reason why many Americans struggle each month to pay off their debt. It can also lower your credit score. 30% of your total credit score is calculated by the amount of debt you have. It is calculated based on credit limits and how many loans you have and what amounts they are for. The higher your balance in relation to your credit limit, the more it can negatively impact credit. Lowering the amount of each loan can help raise credit scores. This problem can be fixed by paying off debts and loans.

#3 - Errors On Credit Reports

Mistakes do happen and they can lower your credit score. The type of error will determine how much it will impact your score. Under federal law, you have the right to dispute information that you feel is inaccurate and have it removed if the bureau can't prove that it is accurate. Check your credit reports at least once a year to check to be sure that the information is accurate.

#4 - Too Many Credit Inquiries

Each time you apply for credit it is noted on your credit report. Making many credit inquiries in a short time can lower your credit score. Inquiries are only 10% of your total score, so it won't be a large drop, but it can cause some credit applications to be denied. Some banks will deny a line of credit or a loan if you have too many recent credit applications.

#5 - Closing Lines Of Credit

Closing credit accounts can also lower your score. Closing an account almost never raises your score, but it almost always lowers it. Closing a card with a balance will make your credit utilization rise. This makes your amount of debt in relation to credit limits rise. A closed card will remain on your report for ten years before it will no longer be included in your score. If this was an old account, your score will drop because credit age is 15% of your total score.

Check Your Credit

You can check your credit report by ordering a copy for yourself. Under federal law, you can get a copy of your own report by going to www.annualcreditreport.com. A credit monitoring service can also help you keep an eye on your credit score.