12 things you didn’t know that affect your credit score

Select’s editorial team works independently to review financial products and write articles that our readers will find useful. We may receive a commission when you click on product links from our affiliate partners.

Credit scores provide lenders with insight into your financial history by analyzing five main factors, but more than five factors influence this important three-digit number.

You probably already know that it is important to pay your bills on time, keep a low debt to available credit ratio (aka Use rate) and maintain a long history of accounts in good standing. You may also know that it is useful to limit new credit requests and have a diverse mix of credit products.

However, some less obvious situations can also impact your credit, such as overdue library books and unpaid parking tickets.

Below, we go over these two startling examples along with 10 other little-known things that can impact your credit rating.

12 things you might not know are affecting your credit score

  1. Credit limit increase requests
  2. Business credit cards
  3. Unpaid medical bills
  4. Telephone payment plans
  5. Rent deduction
  6. Unpaid parking tickets
  7. Overdue library books
  8. Co-sign a loan
  9. Student loans
  10. Personal loans
  11. Car rental and auto loans
  12. Mortgages

1. Credit limit increase requests

When you request a credit limit increase, your card issuer can perform a Hard shot of your credit. This can temporarily alter your credit score by a few points. However, sometimes there are times when credit limit requests don’t hurt your credit score, such as when your issuer gently withdraws your credit or initiates an automatic increase.

2. Business credit cards

If you are a small business owner or employee, the steps you take with your the business credit card can affect your personal credit score. Business owners who are the primary account holder have the most responsibility and therefore the greatest risk to their personal credit. For example, business owners who use the Capital One® Spark® Cash for businesses can add additional employee cards at no cost. While this is convenient, they take on additional risk by letting authorized users charge their line of credit.

3. Unpaid medical bills

Payment history is the most important factor in your credit score and extends beyond your credit card and loan bills. Any unpaid medical bills can be sent to collection agencies after a certain period of time.

4. Telephone payment plan

Installment loans, such as telephone payment plans, may appear on your credit report and can affect your credit score. So if you want the latest iPhone and go for an affordable two-year payment plan, make sure you keep up with the monthly payments.

5. Withholding of rent and utilities

If you withhold rent and utilities or break a lease without paying the lease termination fees, your non-payment may be reported to the credit bureaus and negatively affect your credit. Homeowners and utility companies typically don’t report your payment history to the credit bureaus, but they are likely to report unpaid bills.

6. Unpaid parking tickets

Almost all unpaid fines, tickets, fees, and overheads can damage your credit score down the line, including unpaid parking tickets. If you do not pay for your ticket on time, it can be sent to collections.

7. Overdue library books

This one may come as a surprise – if you return a late library book and don’t pay the fine, the library may send your information to the collections.

8. Co-sign a loan

If a family member or friend needs help getting a loan or opening a credit card, you may want to consider co-signing. However, this could affect your credit in three ways:

  1. A new request may appear on your credit report.
  2. The account balance or loan amount can affect your usage rate.
  3. Finally, any of their missed payments can show up on your credit history.

9. Student loans

Similar to co-signing a loan, the new student loan application and amount appear on your credit report. In addition, your payment history influences your credit score.

10. Personal loans

A Personal loan influences your credit just like a student loan. The loan application, size and payment history are all reported to the credit bureaus.

11. Car rental and car loans

You can take out some kind of car loan at some point, whether it’s a leasing or a car loan to buy a car. The application, loan amount, and your payment history will appear on your credit report.

12. Mortgages

Mortgages are probably the most important loan you can take out and can have a huge impact on your credit score if you fall behind on your payments. (Find out how the NFCC offers free credit counseling to help you pay off your debts and avoid foreclosure in the midst of the coronavirus.)

At the end of the line

To avoid negative impacts on your credit score, maintain an on-time payment history and be aware of co-signing credit products, especially if the co-signer has bad credit.

Don’t miss: Here’s what happens if you don’t activate your new credit card

Information about Capital One® Spark® Cash for Business was independently collected by CNBC and was not reviewed or provided by the card issuer prior to publication.

Editorial note: Any opinions, analysis, criticism or recommendations expressed in this article are the sole responsibility of the editorial staff of Select and have not been reviewed, endorsed or otherwise approved by any third party.

About Jimmie T.

Check Also

Inmates Eligible for Care Act $ 1,200 IRS Stimulus Checks; Here is how to deposit

2 million inmates are eligible for stimulus checks of $ 1,200. They must check the …