How Do You Find Out What Happened To My Credit Score?

Your credit score is one of the most important numbers in your financial life. It can determine whether you get approved for credit cards, loans, mortgages, rental applications, and sometimes even jobs or insurance policies. So when your credit score suddenly changes, it’s essential to find out what caused the shift. Here’s how you can investigate credit score fluctuations and protect your score.

Check Your Credit Reports

The first step is to check your credit reports from the three major credit bureaus – Equifax Experian, and TransUnion. You can get free copies of your reports once a year from AnnualCreditReport.com the government authorized website. Review the reports carefully for any errors, fraudulent activity, or new accounts you don’t recognize that could be hurting your score. Dispute any mistakes with the credit bureaus. This can remove inaccuracies from your reports and improve your score.

Review Factors Affecting Your Credit Scores

Next, look at factors that influence your credit scores and see if any recent changes to them correlate with your score shift:

Payment History

• Have you missed or been late on any loan or credit card payments recently? Even one late payment can drop your scores.

Credit Utilization

• Is your credit card or revolving credit balance suddenly higher compared to your credit limit? Using over 30% of your available credit can lower scores.

Credit Age and Mix

• Did you recently open several new credit accounts? Too many new accounts in a short period can decrease scores temporarily.

Hard Credit Inquiries

• Have you applied for new credit lately resulting in hard inquiries on your reports? Numerous applications in a short time can lower scores.

Available Credit

• Did one of your lenders lower your credit limit? This can increase your credit utilization and hurt your score.

Check for Identity Theft

Another possibility is that someone has stolen your identity and opened fraudulent accounts in your name. Carefully review your credit reports and look for any accounts or activities you don’t recognize. Unfamiliar addresses employers, or credit inquiries can be red flags. Report any potential identity theft to the credit bureaus right away.

Use Credit Monitoring

Ongoing credit monitoring services can alert you whenever key changes appear in your credit reports so you can catch problems early, Credit Karma provides free credit scores and reports that automatically update when new information comes in Monitoring helps detect identity theft and keeps you informed on factors influencing your credit

Contact Creditors for More Details

For significant credit score drops, it’s a good idea to contact your current creditors like credit card issuers and ask if they reported anything negative about you to the credit bureaus recently. They may share details that aren’t obvious from your credit reports. For example, their internal records may show a payment that posted late even though it displays on-time in your report.

Consider Getting Your FICO Scores

The scores provided by Credit Karma and AnnualCreditReport.com are VantageScores, not FICO scores. FICO scores are the most commonly used by lenders. If your FICO scores dropped but your VantageScores didn’t, the root cause may be something specific to FICO’s model. You can buy your FICO scores directly from MyFICO.com. Comparing your FICO and VantageScores can provide a clearer picture.

Review Any Other Impacts

Think about any other new information that may have been added to your credit reports and affected your scores. For example, getting sued, filing for bankruptcy protection, settling a past-due debt, or getting a tax lien can all lower your credit. Ensure any new items are reporting accurately.

Rule Out Score Model Changes

Your credit score can also drop if the scoring model itself is changed to reflect new trends. For example, over the past decade, both VantageScore and FICO have released new versions of their scoring models. The scales change, so a score that’s considered “good” in an older model may rate lower in a newer model. Review any methodology changes from your score providers.

Consider Specialty Scores

Some lenders use customized credit scores tailored to their niche, like auto, mortgage, or credit card lending. These specialty scores may show a decrease even if your general scores don’t. Ask lenders what scoring model they use when you apply for credit.

Contact Your Score Provider

If you can’t find answers from your credit reports or current creditors, consider contacting your score provider (VantageScore Solutions if you use Credit Karma or MyFICO if you use FICO). They may be able to reveal additional details about what contributed to your credit score drop based on behind-the-scenes data they have access to.

Reach Out for Professional Help

If your score dropped due to complex credit situations you can’t decipher, it may be worthwhile to have a professional review your reports. Non-profit credit counseling agencies like NFCC offer low cost credit advice and education. They can identify issues you may have overlooked that lowered your score.

Don’t Make Major Purchases Right Now

A freshly lowered credit score means now is probably not the ideal time to finance a large purchase like a house or car that requires credit. Every new application will result in another hard inquiry and potentially more new accounts that could further ding your score temporarily. Wait until your score rebounds before making major purchases.

Build Up Your Score Again

Once you’ve identified why your credit score decreased, you can start implementing strategies to rebuild it:

• Pay all bills early or on time
• Lower credit card balances and maintain low utilization
• Don’t apply for new credit often
• Have long-standing accounts you use responsibly
• Limit credit inquiries by only applying when needed
• Resolve collections, bankruptcies and other negative items
• Build healthy credit by taking out new credit only when needed

With diligence and patience, your credit score should start increasing back to normal in a few months. But stay vigilant – order fresh credit reports every few months to monitor for new issues that could impact your score. Being informed about changes to your credit is the best way to protect and improve that all-important number.

No, that’s not entirely accurate. While most negative information, like late payments, charge-offs, and collections, generally disappear from your credit report after 7 years, the debt itself isn’t necessarily erased.