What Really Hurts Your Credit
Score (It’s Not Just Missed Payments)
Understand the hidden factors affecting your score — and how to improve them.
When it comes to credit scores, most people focus on one thing: late payments. And while missed payments are indeed important, they’re just the tip of the iceberg. Your credit score is made up of multiple factors — and some of the most damaging ones are the least obvious.
In this blog, we’ll break down the five major factors that impact your credit score and how each one plays a role in shaping your financial profile. Whether you’re starting to rebuild or just want to avoid mistakes, knowing what truly affects your score is key to taking control of your credit.
1. High Credit Utilization
What it is: This is the percentage of your total credit limit that you’re using. For example, if your credit limit is $5,000 and you’ve spent $4,000, your utilization is 80%.
Why it matters: High credit utilization can signal to lenders that you may be overextended, even if you’re making payments on time. Most experts recommend keeping your usage below 30% of your limit — and under 10% is even better for top-tier scores.
How to fix it: Pay down balances strategically. Consider making payments before your statement date, not just the due date, to reduce what gets reported. You can also request credit limit increases (without spending more!) to improve your ratio.
2. Too Many Hard Inquiries
What it is: A hard inquiry occurs when a lender checks your credit for a new application — like for a loan, credit card, or even some job screenings.
Why it matters: Each hard pull can slightly lower your score, especially if you have multiple inquiries within a short period. This can give the impression you’re desperate for credit.
How to fix it: Be selective about what you apply for. If you’re rate-shopping (e.g., for a mortgage or auto loan), try to do all inquiries within a 14–45 day window — they’ll be counted as one. Also, avoid applying for credit you don’t need.
3. Short Credit History
What it is: The age of your oldest and average accounts.
Why it matters: A longer credit history shows lenders you have experience managing credit. New accounts reduce your average age, which can lower your score.
How to fix it: Keep your oldest accounts open — even if you don’t use them often. Avoid closing credit cards that are in good standing, as they help build your age over time. If you’re just starting out, time and responsible use are your best assets.
4. Lack of Account Diversity
What it is: Your credit mix — the variety of credit types you have (e.g., credit cards, loans, auto finance, etc.).
Why it matters: Lenders like to see that you can handle different kinds of credit responsibly. Only having one type, like just credit cards, can slightly limit your score’s potential.
How to fix it: You don’t need to open loans just for the sake of variety, but if you’re ready, having a mix — like a credit card and an installment loan — can help. Tools like credit builder loans or secured cards can also diversify your profile safely.
5. Unnoticed Errors or Negative Items
What it is: These include outdated debts, wrong account statuses, duplicate listings, or fraudulent activity.
Why it matters: Even small inaccuracies can unfairly bring your score down. And the worst part? Many people don’t even realize they’re there until they’re denied credit.
How to fix it: Review your credit reports regularly (you’re entitled to a free report from each bureau once a year at (AnnualCreditReport.com). If you notice something that doesn’t look right, dispute it directly or work with a professional credit repair service like Credit Sister to help challenge the error the right way.
Final Thoughts
Improving your credit score takes more than just paying on time. It’s about understanding the full picture — and adjusting your habits to protect and grow your score long-term.
At Credit Sister, we help clients navigate the full scope of credit repair — from fixing errors to building better credit habits. Need help understanding your report or tackling a low score? We’re just a message away.