Why did my credit score drop 40 points and How to protect
A credit score can affect your life in two ways
If your FICO score is high then the possibility is you will get the approval of your loan or credit card easily with a much-reduced interest rate. Your lifestyle became so easy. You will get the freedom of credit and enjoy life as per your wish. However, there is another possibility of just the opposite of this if your credit score is not good.
There is a lot of reason behind it, next we will discuss why did my credit score drop 40 points and how to protect it from decreasing. If your FICO score is low then the door to your happiness is close all around you and your world is only getting smaller every day. You will never get your dream house, even not in your lifetime. It also restricts you to access a product or services offered by the bank or other financial institutions.
Why did my credit score drop? Top 10 reasons
Avoiding few mistakes can put you way ahead of the game and help you to improve your credit score in the long run. You should aware of the following things that can decrease your credit score.
- Your FICO score factors
- Effects of late payment on your score
- How does collection affect your score
- When Charge off play the game
- Hard inquires may affect your Score
- Not pay your bill on time
- Not keeping your “old” credit cards or old accounts
- Not Pay off your high Interest and “New” Credit Accounts First
- Lack of Accounts Diversity
- Derogatory Mark
- An Error from Data Furnisher
- Identity Theft
Why is my fico score going down
Your FICO score can be split into few major factors like payment history (35%), Debt Burden (30%), Length of History (15%), Types of Credit (10%), and Recent Credit Searches (10%). I will discuss how these factors affect your credit score.