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Paid down credit card, 40 point drop

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5 comments

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    Philip

    Hi Mindy,

    I'd recommend reviewing your credit report carefully to search for other possible causes. See What Factors Affect Your Credit Score for more information.  As Christopher mentioned, look for any accounts that might have closed as a result of you paying them off.  It's great to pay them off, but it can have some affects on your available credit.

    Philip

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    CHRISTOPHER BATTISTA

    So many variables to your credit can cause this. "Credit" comes in many forms and we would need to know what "credit" you paid.
    My first impulse is that you may have paid off accounts that are now closed?  If you paid off NON revolving lines of credit like a loan on a car or house etc.., those accounts are now closed and your available line of credit has dropped. 

    revolving lines increase your credit as they drop, because paying them technically increases your line of credit available. 

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    Mindy

    Hi Philip and Christopher. Thank you for your response. The accounts did not close and my used credit went from 71% to 51%. I've reviewed my accounts in full and keep up with them on Credit Karma almost daily. Any other ideas I should look into? Thanks, Mindy

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    Kim

    Hi Mindy, 

    This is a bit tricky! It can take some time for your credit score to update after paying off accounts or making other changes that may affect your credit.

    For some background, the banks that issue your credit cards/loans send information about your accounts to the major credit bureaus in the US monthly. The credit bureau we partner with to provide your free credit report and score is TransUnion. We sync with TransUnion once each week to get updated information about your credit profile. Since TransUnion can only send us updated information about your accounts if the banks have already sent their monthly reports, there's sometimes a lag of a few weeks between when you make a change and when this information is reflected on your credit report.

    Additionally, since NerdWallet only shows your TransUnion VantageScore, I recommend getting a copy of your credit reports from all three major credit bureaus and reviewing that information as well. This article provides steps on how to do obtain all three credit reports through annualcreditreport.com. 

    In general, I'd recommend logging into your NerdWallet account on a regular basis to keep an eye on your TransUnion VantageScore and continue to review your credit report updates, etc. You may check as frequently as you like; just note that a few weeks may go by before you see anything new.

    Best of luck and please reach out with any other questions! 

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    DeadManMoshing

    Hi Mindy,

    I am not working for nerd wallet and or are not a professional credit consultant. I just am an average guy that had taken a few hard knocks with credit. I came here in early 2019 seeking advice. In short I had a fico score between 450 and 490 in 2019 and in 2021 my fico score is between 632 and 646 (between all 3 credit bureaus).

    One question, did you apply for a new credit card or a loan? Either of those would create a hard inquiry, which will drop your score. Also too, if you use experian boost and unattach an account that has an Experin boost to it, you'll take a hit on it as well (I know this from personal hands on experience. It took 5 months to regain the points I lost and for Experian to reconize the legitimately qualified boost). I only ask so I can offer suggestions that may help. Suggestions from what I've read and or have experienced first hand.

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