Help! My Credit Score Has Been Steadily Increasing And Now It's Stalled! Why? | Refresh Financial

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Help! My Credit Score Has Been Steadily Increasing And Now It’s Stalled! Why?

With all the advice you’ve been absorbing here on our Dime Turner blog, I’d be willing to bet you’ve made some leaps with your credit score. Some of you may have even gotten your score to a high you’d never thought possible before. You might be glued to your credit report, watching as your numbers increase and things start to look a lot better for your wallet.

But what if your credit score just stalls? What if you’ve been watching it go up and up and up and then suddenly, it just stops and stays still for months on end? Why isn’t it moving anymore and how do we dislodge it and get it going again?

There are several reasons why your credit score may appear to “stall”:

1. Credit mix

You only have one type of credit. Credit mix accounts for about 15% of your score, so it’s important to mix up your credit products. There are two main types of credit: installment and revolving. Revolving is the sort of credit you can use over and over, like a credit card; installment is paying down a specific amount, like a loan. If you’ve just got a couple of credit cards, you could be missing out on a few extra points on your score.

2. Average age of your credit accounts

If you’re recovering from poor credit, chances are most of your credit accounts are relatively new. The longer the age of your credit history, though, the better your score. This is one you’re just going to have to wait out. As your credit ages and you keep it all in good standing, your score is likely to increase. To this end, try not to close your oldest account. If it’s revolving credit and it has high interest, simply don’t use it anymore.

3. You still have one or more derogatory items on your credit report

If you made a late payment a few years ago, or perhaps even missed a payment or two, that’s going to behave like an anchor to your credit score. If it’s just one item, your score will be held back slightly until the item is removed after six years or less. If you have multiple derogatory items, you can find yourself unable to reach excellent scores until these items expire from your report. Again, it’s a waiting game, but in the meantime, ensure you’re doing everything else you can to maintain a good score.

4. Your usage is too high

Your credit usage is the percentage of the credit you have available that you’ve used. For instance, if you have $5000 credit total across all credit products and you owe $2500 across all credit products, you have a credit usage of 50%. Try to keep your percentage as low as you can. At least below 30%.

5. Too many recent inquiries

If it appears as though you’ve been reaching out to everyone and their uncle for credit, your score will suffer. It makes you appear as though you desperately need spending power and are a huge risk to lend to. Try not to apply for new credit more often than once per six months, even if you get denied.

6. You still have a bankruptcy or consumer proposal on your credit report

Unfortunately, you’re going to have to wait this one out, too. This can have a pretty devastating effect on your credit but it is possible to rebuild with these still showing up on your report. Your score just won’t get to where you truly want it, until they are gone. For bankruptcy, you’re going to have to wait 6 years and for a consumer proposal, you’re going to have to wait for 3 years before you can bump your score up even further.

One or a combination of any of these things can hold your credit score back from being excellent. These factors can even hold your already good score back from becoming excellent. The best plan of action is to correct any of these you can, and wait the rest out while continuing to build your credit with minimum risk. Consider grabbing yourself a Refresh Financial credit building plan to nudge those numbers and start seeing them move again. Click here.

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