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5 ways to kill your credit score

Nov 12, 2009 | | Comments (3)

FICO finally parted the curtains enough to show us how much effect certain actions–late pays, maxing out, debt settlement, bankruptcy and foreclosure–can have on credit scores. You can see my column about this at MSN Money (CLICK HERE), but here’s a taste:

Prior score:

680

780

Maxed-out card

650-670

735-755

30-day late payment

600-620

670-690

Settling debt

615-635

655-675

Foreclosure

575-595

620-640

Bankruptcy

530-550

540-560

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3 Comments

1

[...] 5 ways to kill your credit &#115core » Ask Liz Westo&#110 [...]

2

I did something dumb. In order to get a 0% interest credit card I agreed to reduce my limit on another account from $47,500 to $20,000 so the same bank would issue $5,000 limit card with a twelve month intro rate (I’m currenty doing major necessary renovations on my home.) How badly will this reduction of credit affect my credit score and is there any thing I can do for damage control? My credit score is typically in the 730 range.

3

Lowering limits can hurt your scores, but it’s hard to predict how much. If you can get your credit utilization below 10% on all your cards, you likely could offset the damage, but I’m guessing that $5k card will be pretty close to maxed out from the start.