10 Things You Didn't Know Can Hurt Your Credit Score

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If you thought only credit cards and loans affect your credit score, you were wrong. Certain applications or late payments can hurt your credit score even if you don’t regularly do business with that company.

1. Overdue library books.

More libraries are enlisting the help of collection agencies to help collect fines from overdue library books. While libraries don’t report to the credit bureaus, debt collectors do and collection accounts are one of the worst things for your credit score.

2. Requesting a credit limit increase.

Some credit card issuers do a “hard” pull or inquiry when you request a credit limit increase. They’re checking your credit history similar to the way they would with a new credit card application. Inquiries are 10% of your credit score and a new one could drop you a few points.

3. Unpaid medical bills.

Like library fines, unpaid medical bills are often sent to collection agencies and then added to your credit report. 

4. Closing a credit card

This is especially true if you close the credit card with a balance. What happens is that your credit utilization goes up and your credit score could suffer. Paying down your balance will help your credit score recover. 

5. Renting a car without a credit card.

It’s tough to rent a car without a credit card. The rental company will ask for a security deposit, extra documentation to prove who you are, and may even run your credit history.

It’s the credit check that could do damage to your credit score, especially if you rent without a credit card often.

6. Unpaid parking tickets.

Left unpaid, parking ticket balances may be sent to a collection agency and placed on your credit report. Paying a collection doesn’t delete it from your credit record; the entry is simply updated to show that you’ve paid it.

7. Applying for several credit cards at once.

Putting in multiple credit applications adds multiple credit inquiries to your credit report and can cause your credit score to drop dozens of points. Opening a new credit card can also hurt your credit score. 

8. Getting a new cell phone contract.

Your monthly cell phone payments don’t affect your credit score, but applying for a new cell phone contract or monthly installment plan can hurt your credit is the service provider does a credit check to approve your application.

9. Cosigning a loan or credit card with someone else.

Cosigning can hurt your credit score in a few ways. First, the application causes an inquiry to your credit. Second, a new credit card or loan balance may cause a drop to your credit by raising your credit utilization and lowering your average age of credit. If the account has any late payments those will hurt your credit just like any other type of late payment.

10. Not using credit cards at all.

If you thought you could avoid ruining your credit score by avoiding credit cards, think again. Part of your credit score is based on the types of credit you have and if you don’t have any credit cards at all, you’ll lose points.

If you’ve never had any type of credit account, you won’t have a credit score at all.