Help! My credit score rating has stopped increasing! Why?

Official blog of Refresh Financial

Help! My credit score rating has stopped increasing! Why?


If you've been working hard to build your credit score rating and it's been increasing but has suddenly stalled, it can be incredibly frustrating.

Why isn’t your credit score increasing anymore?

To find specific reasons why your credit score isn't improving, you can sign up for Borrowell for free and receive personalized tips on what's impacting your credit score. However, there are several common reasons why your credit score rating may appear to “stall”:

1. Credit mix

Your credit score rating can stop increasing if 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 increasing your credit score rating.

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 credit score rating is going to become. 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 credit 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 rating. 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 credit score rating.

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 can impact your credit score rating

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 Builder Loan to nudge those numbers and start seeing your credit score rating on the rise again!

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