5 Things You Didn’t Know Could Hurt Your Credit Score

credit score
Monitoring, improving and maintaining your credit score are all extremely important. Your credit score can prevent you from buying a home or even getting a job. That being said, it is equally as important to know what can hurt your credit score.

Just because you don’t have much debt or you pay your bills on time doesn’t mean you aren’t hurting your credit score in other ways. In fact, there are various ways to mess up your credit that many people don’t realize.

5 Things You Didn’t Know Could Hurt Your Credit Score

If you’ve been working on your credit score you are probably more than familiar enough for the various ways you can improve it. Did you know that some things that may seem like they’d help your score may actually hurt you? Things like cancelling credit cards and missing a payment can all affect your score negatively. Here are a few things you probably didn’t know can (and will) hurt your credit score….

  1. Overdue library books. You wouldn’t think your overdue library books would be impacting your credit score but they do. Many public libraries have partnered with collection agencies to get their money back for the books that are not returned or fees that have gone unpaid. Of course, your fee would have to be pretty substantial but it is a possibility.
  2. Cancelling accounts. What happens to your credit score if you cancel your credit card? Well, your credit score can go down significantly. Closing a credit card account will negatively impact your credit within a month or so of closing the account. Even if your closing balance was $0 cancelling the account will bring your score down.
  3. Unpaid medical bills. Even your medical bills are impacting your credit score. If you’ve left any medical bill unpaid (even the short Urgent Care visits) they will appear on your credit score and they’ll be sent to collections if they go unpaid long enough. Once it is placed for collections your state decides how long it will remain on your credit (some states have up to eight years).
  4. Applying for too much credit. Trying to improve your credit can be difficult but applying for too much credit at one time will negatively impact your credit score. Don’t apply for more than one credit card at a time and wait a few months in between applications. Similarly, don’t ask for too many credit increases as that will bring your credit score down as well.
  5. A new cell phone contract. Opening a new cell phone contract can bring your credit score down a little as well. Although your cell phone company doesn’t report monthly payments, per se, it does run your credit before approving you for a cell phone plan. Running your credit (like applying for credit) can cause a decrease in your credit score.

Although there are many ways to hurt your score, there are just as many to improve it. Don’t procrastinate! Start improving your credit score today.

Photo: Cafe Credit

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