Why Your Credit Score Isn’t Improving

By | November 13, 2018

If you think your Credit Score should be in the green, but it isn’t, then here are a few reasons why you haven’t seen any improvement.

Why Your Credit Score Isn’t Improving

Ever tried applying for a loan or Credit Card and had your application rejected? Have the banks told you it’s because of your low Credit Score?

If you think your Credit Score should be in the green, but in reality, it isn’t, here are a few reasons why it isn’t improving.

How is your Credit Score calculated?

There’s a fair bit of math involved in calculating your Credit Score. If you want a credit expert to assess why your Credit Score is not getting better, you need to show them your credit report. The first thing you need to do when you want to find out why your Credit Score isn’t improving is to check your credit report.

Additional Reading: What Your Credit Report Says About You

What to look out for

Here are four probable reasons why your Credit Score hasn’t shown any signs of improving.

  • Your Credit Card balances are going through the roof

A good 30% of your Credit Score is decided by your Credit Card usage habits. What percentage of your total credit limit have you utilised?

If you have utilised more than 30% of your credit limit, then you need to tread carefully. Try and pay off as much of your Credit Card debt as soon as possible, or at least make regular monthly payments towards your Credit Card bill to improve a stagnant Credit Score.

Additional Reading: When NOT to Use A Credit Card

  • Review your credit history

Your financial past matters. If you are responsible with your credit use, but your score still doesn’t seem to be improving, think back on your credit history. Maybe you defaulted on a bunch of loan or Credit Card payments, or maybe you failed to pay your past Credit Card bills on time. In fact, your credit history makes up 35% of your Credit Score.

Regardless of what you may have done in the past, any negative remarks in your credit report could remain for as long as seven years. Only time can erase this from your report. So, if you’ve only just begun to become financially responsible, you may be in for a long wait. In the interim, do remember to make your payments on time and restrict your credit use to 30%.

Additional Reading: 4 Ways You Can Ramp Up Your Credit Score In 2017

  • Maybe you’re missing something?

There are many other factors that could be influencing your Credit Score. Some of these are: how many times you’ve applied for credit, how long you‘ve been using credit and so on. What also matters is how many various types of credit you have.

Remember, the longer you’ve had credit, the better your Credit Score should be.

Additional Reading: Check Your Experian Credit Score For Free At BankBazaar.com

  • Scan your credit report for errors

Keep an eye out for any errors that might have crept into your credit report. What errors, you ask? Even a misspelling of your name could make a difference to your report.

If you spot an error, notify the credit reporting agency immediately.

Additional Reading: How To Correct A Late Payment Record On Your Credit Report

There you have it! If some of these reasons are responsible for the stagnation of your Credit Score, then there can be no better time than the present to put things right. Remember, always use credit responsibly!

Additional Reading: More Tips To Boost Your Credit Score

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