Recent late payments hurt credit scores the most



Dear Experian,

Why has my credit score dropped 42 points? There is a late payment on one of my cards which has since been brought current, and four of my accounts have been paid off and have a “0” balance. Why doesn’t my score increase as quickly when I pay off accounts as it does when I miss a payment?



Dear KRS,

There are many factors within your credit history that affect your credit scores. The single most important indicator of credit risk is a missed payment, so it will have the greatest and longest lasting impact. The more recent the missed payment occurred, the greater that impact will be, and the more missed payments you have, the longer it will take to recover.

Think about someone who has broken your trust. It takes just one action in one moment to lose your trust, but could take weeks or months or even years of positive interactions to regain it, depending on what the person did to violate your trust.

Bringing the account current is an important first step in restoring your credit scores, but to offset the risk the late payment represented, you must continue to demonstrate a current history of on-time payments. Use at least one of your credit cards, paying in full each month to avoid finance charges.  These on-time payments will add positive activity to off-set the negative in your past.

Over time your credit scores will rebound. The length of time it takes to recover will depend on how serious any other negative issues were.

VantageScore produced a good report on what affects credit scores and how long it takes to restore your credit scores after various negative events. You might be surprised at how quickly scores can be turned around.

Thanks for asking.

The “Ask Experian” team

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