Why would my credit score drop randomly?

Submitted by SenorNoods t3_10q7hzl in personalfinance

I received a notification from Experian that my credit score fell 25 points last week. This is the largest drop I’ve seen, including times where I applied for new credit lines or closed accounts. However, I have changed nothing in over a year. No new inquiries, no new accounts, no missed payments, credit utilization is lower than ever, and my installment accounts have lower balances than ever before.

By all accounts, my score should be increasing, not falling. I pulled all three reports and don’t see anything suspicious, incorrect, or missing. Does anyone know what could possibly explain this sudden, sharp drop?

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thegelatoking t1_j6oadmr wrote

Gravity. 25 drop is nothing to worry about.

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SenorNoods OP t1_j6oogcf wrote

There must be some sort of logic driving the reduction, which is what I’m lost about. There appears to be no actual reason for the drop.

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thegelatoking t1_j6or7j8 wrote

25 is not a steep drop. Any number of things...Company's methods and algorithms are proprietary and not available to the public

Number of days in the month the score was calculated, change in their algorithm used to calculate the score, change in credit utilization (up or down), usage/activity, change of address, market factors, a company accidentally put an extra letter in your name so now you have an "alias" on your report, etc.

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whatsamajig t1_j6oydzy wrote

“Credit utilization is lower than ever” this could be it. 30% utilization is the sweet spot in my experience. If you bring that up a bit it would probably come back. The only benefit would be if you are planning to apply for a loan right now. Unless that’s the case, take the lower interest payment, that money saved is worth more to you.

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SenorNoods OP t1_j6p2yu4 wrote

This could make sense. Just seems like a larger change than I’d have expected from that.

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