Credit Advice

Having bad credit even when all of your bills are paid on time


Have a question?

Do you have a question about consumer credit? You may find an immediate answer by using the search engine. If you can't find what you're looking for, please fill out the form, being as specific as possible.

Please note: The Ask Experian team cannot respond to each question individually. However, if your question is of interest to a wide audience of consumers, the Experian team will include it in a future column.

Our policies
The information contained in this column if for educational purposes only and is not legal advice. You should consult your own attorney or seek specific advice from a legal professional regarding your particular situation.

Please understand that Experian policies change over time. Column responses reflect Experian policy at the time of writing. While maintained for your information, archived responses may not reflect current Experian policy.

Credit Advice

Having bad credit even when all of your bills are paid on time

Dear Experian,

Why is my credit bad? I paid every thing on time.


Dear WOD,

There is a lot more to having good credit than just paying all of your bills on time, although that is extremely important.

Your payment history – whether you have paid your bills on time or late – has the greatest impact on credit scores. However, it typically accounts for less than half of the score, usually between 30 percent and 40 percent of the total.

Several other factors also are critical to being a good credit risk and having good credit scores. Your utilization rate, also sometimes referred to as your debt-to-limit ratio, can also significantly affect credit scores.

Your utilization rate is a comparison of your total balances to your total credit limits, expressed as a percentage. You can calculate that number by adding up all of your credit card balances and all of your total credit limits. Then, divide the total balance by the total limit. 

A high utilization rate indicates you are overusing your credit and may be at risk of default, even if you haven’t yet missed a payment. While you may be making the minimum payment each month, when you have very high balances as compared to your limits, just one unplanned for event could cause you to default on all of your debts.

Credit scoring systems also look at individual accounts. A very high balance on even one credit card can indicate some risk, and so can negatively impact credit scores, although less than your overall utilization rate. The question is, if one card is being charged to the limit, are the others soon to follow?

The length of your credit history is another factor. A short credit history gives less to base a judgment on about how you manage your credit, and so can cause your credit score to be lower.

A combination of these issues can add up to high credit risk and poor credit scores even when all of your payments have been on time.

The best way to find out what is specifically affecting your credit scores is to get a copy of your credit report and a credit score report. You can order a score and report for a small fee when you request your free annual credit report through If you want to monitor your progress you might want to consider subscribing to a service such as Experian’s TripleAdvantage, which gives you unlimited access to your credit report and score.

Both provide detailed explanations of what is positively and negatively impacting your credit scores and creditworthiness, and enable you to tie those factors back to your credit report.

That information will empower you to create a plan to improve your creditworthiness over time so that you can get the credit you want and at the very best rates.

Thanks for asking.

- The "Ask Experian" team

  • © 2016 Experian Information Solutions, Inc. All rights reserved.