Q: Can you explain why my credit score has increased and then decreased suddenly? I just checked my score today it an hour ago and it was 667 then I checked again and he dropped 10 points in a matter of an hour.
A: Because your credit score is based on your credit report and your credit report can be updated at any time, your credit score can also change at any time. Credit reports contain information about you and your credit history. This information is mainly provided by creditors, lenders, employers, insurers and other institutions with which you might have a financial relationship. The information of public record may also appear on your credit report. credit score providers take the information on your credit report and using a (top secret) algorithm transform this information into one number to your credit score.
Because credit information on your credit report is reported by a variety of sources throughout the month, it is constantly in motion. This means that your credit score can change from hour to hour. For example, credit scoring algorithms generally take into account the proportion of balances to your total credit limits on certain types of revolving accounts (such as credit cards). So if you have 3 credit cards with a total credit line of $ 12,000 and you have accumulated $ 6,000 in fees, you have used 50% of your total credit. Now let's say you just paid another $ 2,000 to your cards; with a total of $ 8,000 in fees that you have now used 67% of your total credit limit. When this increase is reported and appears on your credit report, it can hurt your credit score. Conversely, if you pay the original balance of $ 6,000 in full this can positively affect your score.
The above example is only one of many, many things that can affect your credit score. Also keep in mind that you made three credit scores, one from each of the 3 credit bureaus; Experian, Equifax and TransUnion. And when you apply for a credit institution for a loan or a mortgage they could check one or all of your scores. That's why it pays to keep an eye on your two reports and credit scores. The simplest and most economical to do this is by subscribing to a good credit monitoring service. Some of those we strongly recommend are Identity Guard Total protection® and PrivacyGuard.