Let’s have a quick discussion about the small things that hurt your credit score. FICO is the most common scoring system that lenders use to determine your creditworthiness. This score takes data from your credit report and compiles five main factors to figure out your credit score: whether you consistently pay bills on time, how much debt you carry, how long you’ve held credit, your credit types, and how many new accounts you have.
One factor that often trips people up is your debt-to-credit utilization ratio—that is, how much of your available credit you’re actually using. Lenders generally like to see this ratio below 30 percent. Using more than that can signal to creditors that you might be overextended, and it can drag down your score, even if you’re making payments on time.
It’s tempting to open new credit cards just to boost your available credit and lower your utilization ratio, but that strategy can backfire. Each new application triggers a hard inquiry, which can temporarily ding your score. Plus, adding new accounts can lower the average age of your credit history—a factor FICO also takes seriously.
The bottom line? Only apply for credit when you really need it, and keep an eye on how much of your total credit you’re actually using.
But that’s not all. Aside from these five main elements, there are many things you can do to damage your credit score. And those things aren’t always obvious. Let’s take a look at just a few “risky behaviors” you might not have considered.
Making a Late Payment
It might seem like missing a payment by a few days isn’t a big deal, but your credit score would heartily disagree. Payment history plays the single biggest role in your FICO score—so even one late payment can leave a lasting mark. Forgetting to pay your credit card or loan on time could lower your score, and that black mark won’t just fade quietly into the background. In fact, late payments can linger on your credit report for up to seven years, making it harder to qualify for loans, fetch lower interest rates, or land that dream apartment.
Moral of the story? Set those calendar reminders, enable digital alerts from places like Wells Fargo or Capital One, and make a habit of paying every bill on time. Your future self (and your wallet) will thank you.
Let’s talk about the domino effect of “hard inquiries.” Each time you apply for a new credit account—whether it’s a shiny rewards credit card or a home loan preapproval—a lender makes a hard inquiry on your credit report. Too many of these hard pulls in a short window, and suddenly your credit score could take an unexpected dip. Lenders may see this flurry of applications as a sign you’re gearing up to pile on debt, which doesn’t exactly scream “low risk.”
Here’s the good news for the car and house hunters among us: Most credit scoring models, like those from FICO and VantageScore, know you’re probably going to shop around for the best rate. So, if you’re applying for multiple auto loans or mortgages within a relatively short period (usually anywhere from 14 to 45 days, depending on the model), those numerous inquiries typically get grouped together and treated as just one hard inquiry. This means your credit score won’t take a hit for every lender you check with—it’s kind of like speed dating for loans, with no extra penalty for being selective.
Keep in mind, though, this “shopping period” grouping doesn’t usually extend to other forms of credit, like applying for a pile of new credit cards. There, every application might count against you individually, so plan your credit moves wisely.
Never Checking Your Credit Report
One of the biggest mistakes you can make when it comes to your credit is not looking up your credit report regularly. Luckily, this is also the easiest to avoid. You’re entitled to a free copy of your annual credit report every 12 months from each of the three major credit bureaus (Equifax, Experian, and TransUnion). Check your report to review your credit score, find out if there is fraud linked to your name, and check if any other oddities need to be resolved. If you notice a mistake, take the proper steps to fix it – and then follow up to make sure it’s been fixed!
Carrying Too Many Credit Cards
Is your wallet full of plastic? This could be a bad mark on your credit score – even if you pay them in full every month. Even if you haven’t maxed out your available credit, lenders might be concerned about what would happen if you did.
Keeping Your Credit Utilization in Check
Another sneaky factor that can chip away at your credit score is your debt-to-credit ratio—sometimes called your credit utilization rate. This simply means how much credit you’re using compared to your total available credit. As a general rule of thumb, it’s wise to keep this number below 30%. For example, if you have a total credit limit of $10,000 across your credit cards, try not to carry a balance of more than $3,000 at any given time. Lenders (like the folks at Chase, Capital One, or Discover) look favorably on those who can keep their balances low—it shows you’re not relying too heavily on borrowed money.
Opening New Credit Accounts Just to Lower Your Utilization
It might be tempting to open a new credit card or line of credit simply to boost your available credit and lower your utilization ratio. But be careful—this strategy can actually backfire. Each time you apply for new credit, your score takes a small hit from a hard inquiry. Plus, adding new accounts will reduce the average age of your credit history—which is another important factor in your score. Instead, only open new credit when you truly need it, not just to play the numbers game.
Applying for Multiple Credit Accounts at Once
You might think it’s smart to shop around for different lines of credit—store cards, personal loans, and that tempting airline card with the bonus miles. But be cautious! Every time you apply for a new credit account, the lender checks your credit report, and this creates what’s known as a “hard inquiry.”
A single hard inquiry isn’t the end of the world, but if you pile up several over a short period, it can look to lenders like you’re desperate for credit (even if you’re not). Too many applications in a short window can temporarily ding your credit score and raise red flags for banks and other creditors. They may worry you’re about to go on a borrowing spree, making them less confident about your ability to manage more debt responsibly.
So, space out your credit applications when possible—your future self will thank you.
Not Having a Credit Card
Similarly, not having any credit cards can actually be as detrimental to your credit score as having too many. Financial institutions that are considering lending you money need to see that you can handle credit responsibly. If you don’t have a credit card, lenders can’t see how you use credit, and they might rule you out automatically or flag you as a risk.
But even if you do have a credit card—or multiple cards—letting them go unused for months at a time can create its own set of problems. If your accounts sit idle, lenders and creditors may stop reporting updates on your behalf, making it harder for future lenders to evaluate your creditworthiness. Even worse, if an account is left inactive for too long, your lender might eventually close it, which can negatively impact your credit score much like closing an account yourself.
To avoid this, consider using your credit card every few months, even if it’s just for small purchases. Setting up a minor recurring charge (like a streaming service or a subscription box) with automatic payments is an easy way to keep your account active without overspending. This approach shows lenders that you’re actively managing your credit—and helps keep your score in good standing.
Closing Old Credit Cards
Keep in mind that the length of your credit history is one of the five key factors. So while you might decide to close a credit card that you opened recently but never use, it’s a smart move to hold onto your old(est) credit card. You don’t have to use it, but it will come in handy when it comes to your credit score.
It can be tempting to close a credit card account once you’ve paid it off, especially if it’s just gathering dust in your wallet. But before you snip that card in half, consider a couple of things: closing a card can impact both your debt-to-credit utilization ratio and the mix of credit accounts on your credit report—two ingredients that factor into your score. Lenders like to see you can handle a variety of credit types over time. Plus, shutting down a credit card you’ve had for years could actually shorten the average length of your credit history, which may ding your score more than you’d expect. So, if that old card isn’t costing you an annual fee, it’s usually best to keep it open, even if you barely use it.
How to Keep a Credit Card Account Active
Want to make sure your older card stays active and continues to help your credit score? Use it every now and then—think small, manageable purchases like your Netflix subscription or a cup of coffee once in a while. You can even set up a minor recurring payment (like your monthly Spotify or Apple Music bill) and enable automatic payments to avoid missing a due date. This keeps the account in good standing without racking up unnecessary debt.
Letting Credit Card Accounts Go Inactive
Here’s a sneaky credit score pitfall: letting a credit card sit unused for too long. If you go months without using a card, your lender might mark the account as “inactive” and eventually close it altogether. When that happens, it can ding your credit score in two ways: by shortening the length of your credit history and by reducing your total available credit—both things that lenders don’t love to see.
To keep your accounts healthy (and your credit score happy), try making a small purchase every few months on cards you don’t use regularly. Even something as routine as a subscription or a coffee run can do the trick—just be sure to pay it off right away to avoid interest charges.
Applying for Multiple Loans or Credit Accounts
When you apply for new credit—such as a loan, credit card, or even some utilities—the lender will usually perform a “hard inquiry” on your credit report. Here’s the kicker: too many of these hard pulls in a short span can make lenders nervous, signaling that you might be taking on more debt than you can handle. That, of course, can put a dent in your credit score.
But there’s a silver lining for savvy shoppers: if you’re rate-shopping for a mortgage, car loan, or even setting up a utility account, you’ve got a bit of built-in grace. As long as you do your comparison shopping within a certain window (usually 14 to 45 days, depending on the credit bureau), all those related inquiries typically count as just one on your credit report. This way, you can seek out the best deal from lenders like Wells Fargo, Chase, or your local credit union without fear of multiple dings. Just keep in mind—this leniency doesn’t generally apply when you’re applying for several credit cards at once, so space those out to protect your score.
Not Paying Your Parking Tickets
Yes, some cities have started sending delinquent parking tickets into collections. This ultimately means that your $50 violation for an expired meter could balloon into a significant plague on your credit history for up to seven years. So feed your meter, or pay the fine on time!
Having Overdue Library Fines
Another shocker: Some libraries contact collections agencies to handle overdue book fines. If you have a small $3 library fine, you could end up seeing it on your credit report. Do you have a tendency to return your books late or lose library materials? Lenders might determine that this behavior will carry over into your financial life and rule you unworthy of credit.
How Long Do Late Payments Stay on Your Credit Report?
If you miss a payment on a credit account, don’t expect it to disappear overnight. In fact, late payments can linger on your credit report for as long as seven years. That’s right—one missed due date can follow you around for quite a while, making it much more difficult to qualify for loans or snag the best interest rates. All three credit bureaus—Experian, TransUnion, and Equifax—keep these late marks in your file, so it pays to stay on top of your bills!
Don’t damage the solid credit you’ve worked so hard to establish. But understanding exactly what is hurting your score can be tricky. If you are conscientious with your finances and still find that your credit score is lower than you think it should be, reach out to American Credit Foundation right away. You’ll speak with one of the helpful advisors who can help you delve deeper into your financial situation and determine the best path forward.