2 reasons your credit score isn’t improving

Hand putting check mark with green marker on excellent credit score evaluation form.

Do you pay off your credit card bill in full every month but haven’t noticed a big improvement in your credit score?  Improving credit isn’t an overnight task but with hard work, responsible spending and patience, your score will soar.

Many of you are doing everything you have been told to do, but for some reason your credit score hasn’t improved much.  Below are two possible reasons your credit score hasn’t increased as quickly as you hoped.

  • We all understand that our credit utilization ratio (total credit card balances divided by total credit card limits) is a major factor in the calculation your credit score.  What everyone isn’t familiar with is that it is calculated from the total on the statement date, not the due date.  Even if you are paying your balances in full every month, the credit card company maybe reporting a balance, which in turn, could hurt your credit score.  So, how do you prevent this?  Basically by paying most of the bill before the statement date, which lowers your utilization rate and gives you a higher credit score. It is very important that you use less than 50% of your available credit, closer to 30% is ideal.  So, if you have a $10,000 credit limit, be sure to keep your balance owed less than $5,000 at all times.  Less than $3,000 owed is even better.  A small balance owed each month won’t hurt your score and in fact, helps show you are a responsible user but if you are above that 30% amount, each dollar paid as soon as possible will give you the score increases you are looking for.
  • So, you missed a payment, but otherwise have a spotless credit history.  One option you can try is to ask your lender for a good-will deletion.  Which simply means you’re asking the creditor to cut you a break.  Many times the creditor will be happy to do a good-will deletion if you are normally a responsible spender.  This will not work if you are consistently making late payments.  You can start by speaking with customer service, but you may have to go up ladder to get results.  **Also try to make your request as soon after the error as you can.  The sooner, the better.  On time payments are sure to keep your score high.

Staying on top of your credit score is key when purchasing a new home.  Always try to stay educated and familiar with your finances.  When in doubt ask someone, a mortgage lender or someone at your bank will always do the trick.

Have questions about building a new home?  We have answers!  Contact us: www.AdamsHomes.com/Contact-Us

Check out these other related articles:

“4 ways to improve your credit”

“Building credit in 4 easy steps”

“How payment history impacts your credit score”

“Credit Score”

About Adams Homes

Founded in 1991, Adams Homes is known as the premier home builder and is one of the largest privately-held home building companies in the southeast.  Adams Homes has built more than 40,000 new homes since 1991 and builds in seven states including new homes for sale in Alabama, Florida, Georgia, Mississippi, North Carolina, South Carolina, and Tennessee with corporate headquarters in Gulf Breeze, Florida.

Discover all Adams Homes’ communities, model homes and homes for sale on our website, www.AdamsHomes.com.  We have new homes for sale perfect for the first-time buyer, move-up home buyer, who desires to upgrade to a more accommodating new home, and the empty nester who desires to downsize to a smaller home.

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