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New Member
Posts: 1
Registered: ‎10-07-2009
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I'm paying everything on time, why does my score keep going down?

I am a newbie and still learning so if I'm asking a repetitive question, then I apologize.   I just can't grasp why my credit score is dropping!?!  I took a car loan in April 2009 which I make payments on it twice a month, I have only 1 cc which has a low balance which I make payments on it every month, and my school loan which I pay every month.... ALL ON TIME.   I've not opened or closed any accounts.  I've pretty much haven't touched my credit except pay my bills.  Why has my score dropped more than 40 points in the last 6 months and it has not gone up even thought I am making all my payments on time?  What am I missing?  What questions am I not asking?  I don't really know where to begin looking for answers.  Please help!

 

Thank you.

Moderator Emeritus
Posts: 32,869
Registered: ‎08-04-2007
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Re: I'm paying everything on time, why does my score keep going down?

Where are you getting your credit scores from?
Super Contributor
Posts: 5,703
Registered: ‎10-06-2007
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Re: I'm paying everything on time, why does my score keep going down?

PIF by the due date avoids a late payment and interest but the reported balance could be lowering your FICO score since utilization is a good junk of your score.  Try allowing a lower % util by paying part of the baalnce (possibly all) before the statement drop date.  Sometimes its tough to do but with some parctice you can control how much reports even if you charge a lot.
11/28/2014 FICO: EQ: 796 EX:788 TU:803
New Contributor
Posts: 65
Registered: ‎10-17-2008
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Re: I'm paying everything on time, why does my score keep going down?

The car loan might be part of it...I lost about one point for every $1000 on my car loan (lost 15 points when it first reported).   When I paid off the loan, I got the 15 points back...so once you pay off the car loan, you should see a steep rebound.

 

 I had a slow, steady loss of points when I stopped using one of my active credit cards....I was focusing on rewards for my Visa but practically ignoring the MasterCard.   FICO punished the lack of "recent use of credit activity" with a 20 point drop over 6 months.  Having other dormant  cc accounts might cause this, but you said there's only 1 credit card, so this is confusing.  If you have other active (but dormant) cards, this might be your problem.

 

 Another item is utilization.  If you keep adding more balance to your active cc, FICO will drop the score.  You'll get an instant boost by paying off the entire cc balance.

 

One item I might recommend is getting a second credit card, especially if you still have a high score (over 730) and your chance of getting accepted is pretty high.  Having multiple lines of credit increases the score, since you have less utilization on the active revolving credit lines.

 

You might also want to check your credit report and make sure you're not a victim of identity theft.  Someone might've opened other lines of credit in your name. If you don't recognize some of the lines of credit, immediately notify the reporting agencies  and have a fraud alert placed on your accounts.

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