What Damages Your Credit Score? The 6 Biggest Factors
What damages your credit score? The two biggest factors are missing or late payments and high credit utilization, which together make up about 65% of a FICO Score. Defaulting on a loan, closing old accounts, applying for too much new credit at once, and having little variety in your credit can also lower your score.
Building a good credit score takes time, and a few common financial moves can undo that progress faster than most people expect. The good news is that credit scoring is not a mystery. FICO, the score most lenders use is built from five factors, and knowing how much weight each one carries tells you exactly where to focus. Below are the six things most likely to damage your score, ordered by how much they matter, along with how to fix each one.
How Your Credit Score Is Calculated
Most lenders use a FICO Score, which is built from five weighted categories. Per FICO, they break it down like this:
| Factor | Share of your FICO Score | What it measures |
|---|---|---|
| Payment history | 35% | Whether you pay your accounts on time |
| Amounts owed | 30% | How much of your available credit you are using |
| Length of credit history | 15% | How long your accounts have been open |
| New credit | 10% | Recently opened accounts and hard inquiries |
| Credit mix | 10% | The variety of credit types you manage |
The two largest categories, payment history and amounts owed, account for about 65% of your score. That is where damage does the most harm and where good habits pay off fastest.
1. Missing or Late Payments (Payment History, 35%)
Payment history is the single biggest factor in your score, so late and missed payments do the most damage. A payment reported 30 or more days late can stay on your credit report for up to seven years. The most severe version is defaulting on a loan, which happens when you stop paying entirely, and the account is charged off or sent to collections. A default can weigh on your credit for years.
How to fix it: Bring any past-due accounts current as soon as you can, then keep every future payment on time. Set up automatic payments within digital banking so your due date never slips. If you are struggling to pay, contact your lender before you miss a payment. At BluPeak, our free financial counseling can help you build a plan, and reaching out early almost always leaves you with more options than waiting does.
2. High Credit Utilization (Amounts Owed, 30%)
Credit utilization is the percentage of your available credit you use, and it makes up nearly a third of your score. Carrying high balances, or maxing out a card, signals to lenders that you may be overextended. A common guideline is to keep utilization below 30% of your limit, and lower is better.
How to fix it: Pay balances down below 30% of each card’s limit and pay in full when you can. Making a mid-cycle payment before your statement closes can lower the balance that gets reported. If a large one-time purchase pushed your balance up, FlexPay lets members split eligible purchases into smaller installments instead of carrying it on a card.
3. Closing Old Credit Accounts (Length of History, 15%)
Closing a credit card can lower your score in two ways. It shortens your average credit history length and reduces your total available credit, which pushes your utilization up even if your spending stays the same. That is why paying off a card and then closing it can still cost you points.
How to fix it: Keep older accounts open, especially your oldest one, even if you only use the card occasionally. A small recurring charge you pay off each month is usually enough to keep an account active. If a card has an annual fee you no longer want to pay, ask the issuer about downgrading to a no-fee card instead of closing it.
4. Applying for Too Much Credit at Once (New Credit, 10%)
Each time you formally apply for credit, the lender runs a hard inquiry, which can lower your score by a few points. Opening several accounts in a short window compounds that and it can signal financial distress to lenders. New accounts also have no track record of on-time payments yet, which weighs on the new-credit category. For the full picture, see our guide to soft and hard credit inquiries.
How to fix it: Space out your credit applications and only apply for what you need. If you are rate-shopping for a single loan such as an auto loan or mortgage, cluster those applications within about two weeks so the scoring models count them as one inquiry.
5. Not Enough Credit Variety (Credit Mix, 10%)
Credit mix is the range of credit types you manage, such as credit cards, auto loans, and personal loans. Lenders like to see that you can handle more than one kind of credit responsibly. Relying on a single card for everything gives them less to go on, which can hold your score back slightly.
How to fix it: Don’t open a loan you don’t need just to add variety. Instead, let your mix grow naturally as you finance real goals. A first credit card used responsibly, or an auto or personal loan you were already planning, adds variety over time without added risk.
6. Errors and Fraud on Your Credit Report
Not all damage comes from your own actions. Mistakes on your credit report, or accounts opened by an identity thief, can pull your score down without you knowing. This is why monitoring matters. You are entitled to free weekly reports from all three bureaus at AnnualCreditReport.com.
How to fix it: Review your reports regularly, and dispute anything inaccurate with the bureau and the creditor. The FTC’s IdentityTheft.gov walks you through the steps if you spot fraud, and freezing your credit can block new accounts from being opened in your name. Our guide on whether to freeze your credit explains when that makes sense.
Does Checking Your Own Credit Score Hurt It?
No. Checking your own credit is a soft inquiry, which never affects your score, so you can check as often as you like. This is different from a hard inquiry, which happens when a lender checks your credit because you applied for a loan or card. Reviewing your own report regularly is one of the healthiest financial habits you can build, because it helps you catch errors and fraud early. You can review your credit anytime in the BluPeak’s digital banking app after you enroll in Savvy Money.
Does a Debt Consolidation Loan Hurt Your Credit?
Usually only a little, and only for a short time. Any new loan creates a hard inquiry so you may see a small dip at first. But a debt consolidation loan can help your score over time by rolling high-interest balances into one lower, fixed payment, which lowers your credit utilization as you pay it down. The key is to avoid running your credit cards back up once you pay them off.
FAQs
What damages your credit score the most?
Missing or late payments cause the most damage, because payment history is 35% of your FICO Score. High credit utilization is next, at 30%. Together they drive about two-thirds of your score.
What lowers your credit score without you realizing it?
Closing an old credit card, letting a card balance creep up, an unnoticed late payment, and errors or fraud on your credit report can all lower your score quietly. Checking your report regularly helps you catch these.
Does closing a credit card hurt your credit score?
It can. Closing a card shortens your average credit history and reduces your available credit, which raises your utilization. Keeping older accounts open, even with occasional use, usually helps your score.
How much does a late payment drop your credit score?
It varies by your starting score and the lender, but a payment reported 30 or more days late can lower a strong score significantly and stay on your report for up to seven years. The impact fades over time as you pay on time.
Does checking your own credit score lower it?
No. Checking your own credit is a soft inquiry and has no effect on your score. Only hard inquiries, which come from applying for new credit, can lower it.
How long does it take to recover from credit damage?
A single late payment or hard inquiry usually recovers within a few months of on-time activity. More serious damage, such as a default or collection, can take longer, but consistent on-time payments and low balances rebuild your score over time.
