Credit Report & Scores

Why Does My Credit Score Change So Often?

Editor's Note: This question comes from Brian, AKA Meaux Jeaux on Facebook, and we are answering it as part of our "Ask Susie Q&A" Series. If you have a question for us, ask us on Facebook or Twitter and we may pick yours to answer next.

Your Credit Score Is Not a Static Number

Credit scores are often thought of as static numbers, that only change when you have a credit event, such as applying for credit or being more than 30 days late on a payment.

In fact, credit scores can change often, especially for those people who are very active with credit. The reason why? Credit scores are calculated using information from your credit file, also known as a credit report, which is constantly changing.

The lenders, credit card companies and banks you do business with update your account status by sending information to Experian and the other two credit reporting agencies, Equifax and TransUnion, about every 30 days.

Your account status is a record of how you are managing your account, such as if you paid your account on time and how much you paid. Your account status can also reflect negative activity, such as if you paid late, and how late (30, 60 or more than 90 days past due).

Every time your credit file changes with new monthly account status updates, your credit score can change too, either higher or lower, depending on the data.

Example Scenario

Let's say you have a credit card with a $2,500 credit limit, and you purchase a big screen TV for $2,000. Your credit card company will report your account balance of $2,000, so for a period of time, your account will be "highly utilized", meaning you are spending close to your credit limit.

The ratio of your balance to your credit limit is called credit utilization rate, or credit utilization ratio, and it's ideal for most credit scores to keep this at 30% or lower.

In this example, utilization is higher than that (80%), which could decrease your credit scores.

The good news is, as soon as payments on this account decrease the outstanding balance so the account is not so highly utilized, your credit scores will most likely improve.

You can get much more information about managing your credit, your credit scores and much more at And remember, you can #AskSusie your credit questions on Facebook or Twitter.

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Editorial Disclaimer: Opinions expressed here are author's alone, not those of any bank, credit card issuer, or other company, and have not been reviewed, approved or otherwise endorsed by any of these entities. All information, including rates and fees, are accurate as of the date of publication.
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