Everyone needs to keep a very close eye on their credit score since it factors into many of lifes biggest decisions.
A couple steps you can take right now include:
- **[Taking a look at your credit score](https://everydayeconomics.net/how-to-get-your-credit-score-credit-review)** - Looking at your own credit score does not hurt your credit, it also includes a credit monitor
- **[Freezing](https://usa.gov/credit-freeze)** your credit reports - This can be done with Experian, Equifax and Transunion to help prevent unauthorized accounts from being opened
Feel free to ask any credit score related question
Let's keep things in perspective. 6 points is not tanking your score. I understand that you also crossed that 700 boundary, and that is a symbolic thing, but the drop in score is minor and termporary.
I have also seen my score drop a bit when I cross the 5% threshold. It is never many points, but it seems to be a line that will have an impact. The good news is that when you get your utilization under 5% again next month, those points will come right back.
I think I'm overreacting. I've been a bit fixated on increasing my score tl due the last 4/5 months as I've been house hunting. ( I started in the 630s for context) Hitting 700 was a big psychological win, so to see it fall definitely triggered me. Like you said, it'll most likely go back up next month and I'm still in the same rating range anyway.
Pulling your score up by 70 points is quite an accomplishment. Congratulations.
Yes, house hunting can be stressful, and worrying about credit, interest rates and mortgage approvals are very annoying. Your dismay at a small drop is understandable.
You've almost certainly got older delinquencies on your report and until they completely fall off, you're going to have a substandard score. It's nice to watch it improve slowly over time, but when you finally have a pristine report, it will jump considerably.
Ive only ever been late on 1 occasion 4 years and 7mo ago according to Experian and CKarma. It was a student loan situation where I didn't know payments started (on 3 separate loans) . Outside of that I've never paid additional interest on any revolving lines of credit- that is to say, I pay in full every month. I also have 0 delinquencies
You're probably right, those late payments along with my relatively young (4yo) credit age is probably what's stifling my progress into the mid - high 700s
If you aren't actively seeking a loan right now, it will have no effect on your life. It's just a score until you seek a new line of credit, and building credit right will involve some fluctuations, most commonly because of utilization. The fact is, the vast majority of the time, you don't need low utilization, because you aren't seeking a loan most of the time. And efforts to keep utilization low regularly can stifle growth in a number of ways. Primarily, if you under-utilize your revolving credit accounts, you're less likely to see credit limit increases (CLI's) and when you do get them, they'll probably be smaller. Using cards 'well', as long as you always pay your statement balance in full, will not negatively impact your long-term score and will contribute to CLI's that, over time, will drop your utilization a lot - to the point where you barely have to manage your utilization when you do seek a loan.
Case and point, 4 years ago my combined credit limit was around $12k. The total of regular monthly bills I put on my cards was a bit over $1k so I was using 8-9% of my limit. If I had tried to reduce the amount I put on the cards to keep utilization under 4-5% all of the time, I likely wouldn't have gotten many CLI's. But because I didn't under-utilize and always pay my full statement balance on time, I now have a credit limit around $40k with the same monthly bills which puts my utilization between 2-3%.
And like u/quantumspork said, 6 points is not 'tanking your score' and that mindset may lead you to make choices, like in the case on utilization, that are counterproductive to long-term growth in building credit. So don't worry about utilization, don't worry about 6 points, don't even worry about your score. Just build your credit as you progress through life, spend within your means, never miss a payment, and you'll be in good shape, have a good profile and a good score will follow.
That's a really good point about underutilization preventing CLI, thanks for putting things into perspective. I definitely don't want to shoot myself in the foot by being too conservative, just because a minor score change. Thanks again for the sound advice
Credit scores constantly fluctuate small amounts. Mostly due to utilization. Don't worry about it.
The only time your score actually matters is when you are applying for credit. That's the only time you should go out of your way to make sure utilization is low.
Utilization doesn't have any memory. You could be at 95% utilization for a year, then decide you needed to apply for a mortgage. Then you pay off your cards so utilization is at 0%, 1%, something very low, and as soon as it processed, all that time at high utilization would not matter at all. The credit score only cares about how it calculates now.
It's unlikely that utilization has anything to do with the score change. It can and will vary that much from conditions and factors beyond your control.
Besides, if you have low utilization and a score barely hitting 700, you have other issues that are pulling it down. Go address those first before worrying about utilization.
Definitely on to something here, I have about a year and a half until 2 hard inquires fall off as well as 3 over 60 day late payments (payments ob my 3 student loans resumed and I was unaware, missing the first payments) that happened 4 years & 7 mo ago.
That along with my young (4y.o.) credit age are definitely stifling my progress. I guess for now all I can do is wait and keep following best practices
>tanked my score
I'm sorry but no. It's a 6 point change. That is insignificant.
Stop obsessing over your score and just keep good spending practices and pay your statement balance before the due date every time. You aren't approaching your relationship to your credit score appropriately at all.
Everyone needs to keep a very close eye on their credit score since it factors into many of lifes biggest decisions. A couple steps you can take right now include: - **[Taking a look at your credit score](https://everydayeconomics.net/how-to-get-your-credit-score-credit-review)** - Looking at your own credit score does not hurt your credit, it also includes a credit monitor - **[Freezing](https://usa.gov/credit-freeze)** your credit reports - This can be done with Experian, Equifax and Transunion to help prevent unauthorized accounts from being opened Feel free to ask any credit score related question
Let's keep things in perspective. 6 points is not tanking your score. I understand that you also crossed that 700 boundary, and that is a symbolic thing, but the drop in score is minor and termporary. I have also seen my score drop a bit when I cross the 5% threshold. It is never many points, but it seems to be a line that will have an impact. The good news is that when you get your utilization under 5% again next month, those points will come right back.
I think I'm overreacting. I've been a bit fixated on increasing my score tl due the last 4/5 months as I've been house hunting. ( I started in the 630s for context) Hitting 700 was a big psychological win, so to see it fall definitely triggered me. Like you said, it'll most likely go back up next month and I'm still in the same rating range anyway.
Pulling your score up by 70 points is quite an accomplishment. Congratulations. Yes, house hunting can be stressful, and worrying about credit, interest rates and mortgage approvals are very annoying. Your dismay at a small drop is understandable.
You've almost certainly got older delinquencies on your report and until they completely fall off, you're going to have a substandard score. It's nice to watch it improve slowly over time, but when you finally have a pristine report, it will jump considerably.
Ive only ever been late on 1 occasion 4 years and 7mo ago according to Experian and CKarma. It was a student loan situation where I didn't know payments started (on 3 separate loans) . Outside of that I've never paid additional interest on any revolving lines of credit- that is to say, I pay in full every month. I also have 0 delinquencies You're probably right, those late payments along with my relatively young (4yo) credit age is probably what's stifling my progress into the mid - high 700s
If you aren't actively seeking a loan right now, it will have no effect on your life. It's just a score until you seek a new line of credit, and building credit right will involve some fluctuations, most commonly because of utilization. The fact is, the vast majority of the time, you don't need low utilization, because you aren't seeking a loan most of the time. And efforts to keep utilization low regularly can stifle growth in a number of ways. Primarily, if you under-utilize your revolving credit accounts, you're less likely to see credit limit increases (CLI's) and when you do get them, they'll probably be smaller. Using cards 'well', as long as you always pay your statement balance in full, will not negatively impact your long-term score and will contribute to CLI's that, over time, will drop your utilization a lot - to the point where you barely have to manage your utilization when you do seek a loan. Case and point, 4 years ago my combined credit limit was around $12k. The total of regular monthly bills I put on my cards was a bit over $1k so I was using 8-9% of my limit. If I had tried to reduce the amount I put on the cards to keep utilization under 4-5% all of the time, I likely wouldn't have gotten many CLI's. But because I didn't under-utilize and always pay my full statement balance on time, I now have a credit limit around $40k with the same monthly bills which puts my utilization between 2-3%. And like u/quantumspork said, 6 points is not 'tanking your score' and that mindset may lead you to make choices, like in the case on utilization, that are counterproductive to long-term growth in building credit. So don't worry about utilization, don't worry about 6 points, don't even worry about your score. Just build your credit as you progress through life, spend within your means, never miss a payment, and you'll be in good shape, have a good profile and a good score will follow.
That's a really good point about underutilization preventing CLI, thanks for putting things into perspective. I definitely don't want to shoot myself in the foot by being too conservative, just because a minor score change. Thanks again for the sound advice
Credit scores constantly fluctuate small amounts. Mostly due to utilization. Don't worry about it. The only time your score actually matters is when you are applying for credit. That's the only time you should go out of your way to make sure utilization is low. Utilization doesn't have any memory. You could be at 95% utilization for a year, then decide you needed to apply for a mortgage. Then you pay off your cards so utilization is at 0%, 1%, something very low, and as soon as it processed, all that time at high utilization would not matter at all. The credit score only cares about how it calculates now.
Pay off the card every month. Don’t wait the extra interest free grace period. Between 0 and 3% is the sweet spot.
So far so good, haven't paid a cent of interest. Wouldn't I be at risk of underutilizing and missing out on higher CLI as another user pointed out?
You can leave one percent or less on it, if you want. We just pay it off.
It's unlikely that utilization has anything to do with the score change. It can and will vary that much from conditions and factors beyond your control. Besides, if you have low utilization and a score barely hitting 700, you have other issues that are pulling it down. Go address those first before worrying about utilization.
Definitely on to something here, I have about a year and a half until 2 hard inquires fall off as well as 3 over 60 day late payments (payments ob my 3 student loans resumed and I was unaware, missing the first payments) that happened 4 years & 7 mo ago. That along with my young (4y.o.) credit age are definitely stifling my progress. I guess for now all I can do is wait and keep following best practices
>tanked my score I'm sorry but no. It's a 6 point change. That is insignificant. Stop obsessing over your score and just keep good spending practices and pay your statement balance before the due date every time. You aren't approaching your relationship to your credit score appropriately at all.
Is this your FICO8 score? Cause anything else is questionable.