5 Factors Affecting your Credit Report Adversely

Before knowing the factors affecting your credit report you should be aware of what is credit report. Credit report is an important factor in your day to day life as it is implemented in many businesses to make decisions about you. The report is a number that lenders use to determine the risk of lending money to the given borrower. The essential lenders such as credit card companies, auto dealerships and mortgage bankers will check your credit card score to decide how much eligibility you have to lend the money and pay interest on it. Before you choose to take any essential decision of life such as going for a job, issuing an insurance policy, renting out an apartment or buying house insurance companies, landlords and employers look your credit card score to check your financial responsibilities.

Credit cards

The major factors that have adverse affect on your credit card report are:

History of your payment

Payment history covers 35% of your credit report. It will show whether you can be trusted to repay the money granted to you. This part of your score clearly states the following factors:

  • Whether the bill is paid on time. Late payment gives a negative effect
  • If late it shows whether you paid within 30 days, 60 days or 90+ days appropriately, more the time taken worse will be your score.
  • Serious payment issues like charge-off collection, bankruptcy, possession, and foreclosure details.

These are the factors that affect your credit report from lenders perspective. Paying the bill on time will increase the value of your credit card.

Also Read: How to Improve Your Bad Credit Score?

Level of debt

This factor covers 30% of the overall credit report. It looks for the following factors:

  • Overall debt you hold. Less is better than nothing. Because it will help the lenders to understand how capable you are for repaying.
  • Debts in specific type of accounts such as mortgage, auto loans, credit cards and instalment accounts. This help to check that you are capable of managing multiple types of credit.

Less debt will have low impact on your credit report that will help you to score more trust from the lenders.

Also Read: 5 Tips to Protect Yourself from Credit Card Fraud

Age of credit card

This factor covers 15% of your total credit card report. It considers both the age of your oldest account and also the average age of all your accounts. Older the age of your credit card longer will be your history (without any negative marks or late payments). Short history will also be fine if the payments are made on time. Opening new accounts at the same time lowers your credit age so it is wise to open one at a time.

Types of credit

This factor covers 10% of the overall credit card report. Managing different types of account such as revolving accounts and instalment accounts is helpful in indicating how well versed you are in using and managing the accounts. As it covers only 10% of the total report having any one type of accounts won’t affect your credit score to large extent.


This covers 10% of the overall report. When you make a credit based application an inquiry is placed on your credit report. It affects your report if you place several credit checks at a time or within a certain period of time (say 12 months) will affect your score terribly. But the good news is that inquiries made within last 12 months are taken into account.

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