Good credit becomes bad in 12 months
Q: About a year ago my FICO score was very good, now it's 616. I don't understand. I have never been late on any payments at all! Can you advise?
A: As I understand you just know the score but haven't seen your credit report, otherwise you wouldn't ask. You should see your credit report ASAP. Could be some minor things that can be easily fixed, but could be something more serious that requires immediate attention. You can order an free annual credit report, or see our credit report monitoring comparison and get your report from the sources compared.
In general, could be several things that can turn good credit into a bad one without ever being late:
1. You have carried a balance on your credit card that is too close to the card credit limit. You should keep the ratio between balance and limit at 35% or lower. Credit scores are really affected and get bad once you go over 70%. FICO algorithm checks the ratio for each credit card account as well as the ratio between the sum of all balances and sum of all limits.
2. Did you close one credit card or more which had $0 balance for some time but kept the cards that are maxed out or near it? If yes, then what happened is what I just described above.
3. Someone stole your identity, opened credit lines and don't pay, check identity theft and social security protection pages.
4. Did you cosign for someone who stopped paying? Of course you should be notified about such a situation before your credit is affected, but it does happen.
5. Credit agency sometimes mistakenly assigns to your report bad stuff from someone else with a very similar name.
6. Have you aggressively shopped for credit? If your credit history is less than 2 - 3 years old or you have few credit records on your report, the resulting numerous hard inquiries will make your FICO bad fast. See more on credit report inquiries.
Wed Apr 29, 2009 01:04PM | Copyright: www.bad-credit-advisor.com | More in Credit Repair Tips | Comments (0)
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