The meaning of “too few accounts paid as agreed”

Dear Experian,

How can “too few accounts currently paid as agreed” be a reason for an adverse effect on my credit score when I currently have no unpaid accounts?



Dear MIJ,

In addition to whether your accounts are paid on time, credit scoring models also look at the length and depth of your credit history.

The risk factor “too few accounts currently paid as agreed” does not necessarily mean there are late payments or unpaid accounts appearing on your credit report. It can also mean that you simply have too few accounts in your credit history to determine lending risk.

It is possible that you haven’t been using credit for very long. As time goes by, the length of your credit history will increase, and you can accumulate a greater “mix” of accounts.  Perhaps you should consider opening another account, such as one offered by a department store for a discount, if you won’t be tempted to use it to spend more than you can pay each month.

Continue making all your payments on time, and keep your balances low. In time your credit scores will likely improve as a result.

Thanks for asking.

The “Ask Experian” team

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