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Why Is Your Credit Score Low Despite On-Time Bill Payments?

Why Is Your Credit Score Low Despite On-Time Bill Payments?

Is your credit score lower than you expected? If so, you are not alone. A lot of people wonder why their credit score is lower than they thought it would be, despite paying bills on time and how to fix it. From getting a loan to any kind of mortgage, you need to have a good credit score. So, it is essential to take care of finances so you can easily maintain a good credit score, and for that, you must have some basic knowledge about it. Sometimes it happens that your credit score is going down, and you do not have any ideas why it is happening. 

If your credit score isn’t good as expected, here are the reasons why you have a low credit score.

Your one or more credit cards have a high balance

Paying bills on time isn’t enough. You must pay attention to the balance on each card you own. The credit utilization ratio, which is the portion of the credit limit you use – figured on an all and per-card basis, immensely influences your credit score. To attain a better score, aim not to use more than 30 percent of your credit limit on each card. If you want to learn more about it in more detail, then you can find it available at CoastTradelines`s website.

Mixed credit file or identity theft is taking you down

Sometimes, someone else’s credit activities are mistakenly reported as yours, and you keep wondering why your credit score isn’t getting better. This may happen when a criminal uses your credit card number or opens a new account using your name. In another rare case, your credit file gets mixed up with another person’s file because of the same name.

You recently applied for a new credit card

Whenever you apply for a new card or loan, a few points are taken from your score, whether you accept the credit product or not. That’s because multiple credit applications reflect a risk that you might not make payments as agreed. If you don’t want your score to suffer from multiple credit applications, the best solution is to stop applying.

You have no idea about a lurking default judgment

When your credit score doesn’t get any better, chances are there is a default judgment against you, and you have no idea about it. This mostly happens when you don’t receive any letter or the person intentionally fails to notify you about the lawsuit (known as sewer service), so you stay unaware of all this. Check your credit report, which contains all information from public records, whether there’s a default judgment or not. In such a case, you can either accept the judgment to settle it or challenge it.

Now, you know the possible reasons why your credit score is lower than you expected. If you’re looking for credit solution experts to repair your credit score in and around, get in touch with the experts. 

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