Common mistakes that hurt your credit score

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Your credit score is a number that it is impossible to get rid of. Whenever you are applying for a home loan, looking for a credit card with the decent amount of offers or opening up your own business, you, undoubtedly, are eyeing to obtain a decent credit from a lending institution. Your credit score is the sole factor which can build up or completely destroy your financial reputation in front of lending institutions; hence, it is extremely important to avoid the following common mistakes that hurt your credit score. If you are the one who is already having a low credit score then avoiding these common mistakes become more essential for you. Also, you can take the help of some of the best credit repair service companies who can assess your current credit score and provide you with efficacious ways to improve it.

  • Paying Bills Past Due Date

Your past payment history is the most driving factor in calculating your credit score. Although if you miss out on the due date of your credit card payments or loan installments, once or twice, it won’t hamper your credit score. However, if you make it a habit it can certainly go against you in determining your final credit score. All banks and lending institutions are obligated to report to the concerned organization, which calculates the credit score, of your payments and if you are skipping on the due date every time, it will, certainly, affect your credit score and make you a high-risk customer for banks whenever you will apply for a loan.

  • Too Much Debt

If you already owe too much money in the form of loans, credit cards and other relative financial instruments your credit score can get negatively impacted. This is because lenders will question your ability to repay. All this information is analyzed, whenever you apply for a loan, to decide whether to sanction your loan or not and also to determine interest charges. Hence, don’t go overboard with the temptation to spend more on your credit cards in a bid to get handsome rewards that credit card companies offer on every spending that you make. These offers are set up to encourage you to spend more and falling for the same is, certainly, not a good idea if you are looking to keep yourself free from debts and maintain a good credit score .

  • In Possession of Too Many Credit Cards

Yes! Your credit report is having information on each credit card that you own. You might not spend those credit cards but the possession of too many credit cards can result in lenders declining your loan application. This is because each lender will have a fear in their mind that if you happen to use all of that credit which you have, you will, undoubtedly, get into deep financial troubles and will have a difficult time repaying the loan on time. So, if you own more than two credit cards it is best that you get the extra ones closed.

  • Multiple Loan or Credit Card Inquiries

Every time you apply for a loan or a credit card, the lending institution is obligated to run a query to extract your credit report and an official inquiry is made for the same. If you happen to apply for loans or credit cards often, which usually happens when one lender rejects your application, it goes against your credit score as the lenders might assume that you are in some sort of financial trouble.

  • Cheque Bounces

Although cheque leaves are rarely used they are still an important means of making payments in businesses.  If a cheque of yours happen to get bounced due to insufficient balance in your debit account you might get reported by the collection agency, which can negatively affect your credit score and you may face problems in getting future lines of credit.

  • Failure in checking your credit reports

If you don’t review your credit report this is probably the biggest mistake you can ever make in your financial life. Several online lending platforms happen to provide you with your free credit report each month. It is your obligation to check your credit report as and when you receive the same and look out for any kind of errors or discrepancies. If you happen to note any please report the same, immediately, to the concerned authority to get the same rectified. This is in an immediate fix to improve your credit score.

  • Co-Signing for someone else’s loan

Agreed it is really tough to say no to a loved one or a person who is really close to you whenever he/she asks your help as a cosigner in their loan application. Well! You might think that you have done a good deed and maintained your relationship with the particular person. However, you have also put yourself in a major financial risk as if the person happens to default on the loan payments; the responsibility of the same comes on you and even your credit score will be adversely affected in the process. However, if a person happens to be regular in making their payments then it’s a totally different story, but, the tenure of a loan is, usually, long and there is always a possibility of a financial trouble to come across.


Everyone wants to have a great credit score and strive to achieve the same. Hence, it is best that you don’t hit the axe on your own foot by making any of the above-mentioned common mistakes that negatively affect your credit score. If you happen to have a not-so-good credit score work gradually towards improving the same because credit score is not something that gets changed overnight. Pay your bills on time and maintain a decent credit history and your credit score will always stay in the healthy range.


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