Credit Score Plummeted

JayGee90

Hello, All. Newbie here. Hope you're all well!
I've looked around and don't see any threads distinctly similar so thought I'd start my own.
In short, my (Clearscore) credit score had dropped considerably; from a good/excellent to well below average. In terms of numbers, we're sub-300 here.
I had worked to get a good credit score, at one point topping it out on Experian at 999, prior to getting my first property. In total, I'm paying for a mortgage, the usual household bills, and a car on HP. Much of everything else is the same as when I had a good rating. I've one credit card, with about £4000 allowance on it. I use it for daily spending and always pay in full at or before the end of the month. It's worth mentioning that I've paid every debt on time

So first question: Would these new expenses account for the drop in score, or is there something else?
Second question: In terms of improving my score, would it be more effective to pay any credit card debt as and when they come in (i.e multiple smaller payments throughout the month), or allow it to build to a larger lump sum to be paid at the end of the month?

Many Thanks!
Jay

MaryNB

Your credit score doesn't matter. Only you and the credit rating agency see it. Banks don't. You only need to make sure the information on your credit files is good, not the score.

Do some financial housekeeping and have a look at your credit files to make sure everything is above board.

• Transunion - use Credit Karma for free access
• Experian - use MSE Credit Club for free access
• Equifax - use Clearscore for free access

If you got a mortgage recently your score would have dropped because a mortgage is a change to your credit file and it results in a change of address. My score across the three CRAs has dropped significantly because I got a mortgage recently. 
Don't worry about this. Just keep payments up to date and keep an eye on your file to make sure everything is good.

Ebe_Scrooge

The new mortgage and HP arrangement will almost certainly have affected your score - the score goes down in response to any change in your credit circumstances, good or bad.  Thankfully, your score is as much use as a sack of wet mice, lenders neither see nor use it in any lending decisions.  It's your credit history that matters.

In terms of building/maintaining a good credit history, make sure all bills are paid on time.  So by paying your mortgage and HP bills on time each month, you're already starting to build a favourable history.  In terms of credit cards, it's best to wait for the statement to arrive then pay it in full (obviously before the "payment due" date, which is usually a couple of weeks after the statement arrives).  Making interim payments is not bad as such, but it does mean that it appears on your credit file as though you're not using it (zero balance at the time the statement is produced).  So you're losing the benefit of building up a solid payment history.  And as long as you do always pay in full every month there'll be no interest to pay.

sourcrates

JayGee90 said:

Hello, All. Newbie here. Hope you're all well!
I've looked around and don't see any threads distinctly similar so thought I'd start my own.
In short, my (Clearscore) credit score had dropped considerably; from a good/excellent to well below average. In terms of numbers, we're sub-300 here.

Jay

There are literally hundreds of threads on this forum asking why my credit score has dropped, gone up, stayed the same or any combination of the three.

Your "credit score" doesn't exist, its a number generated by the CRA`s that enables them to peddle their wares to you, in other words its a marketing tool, and a very effective one at that, as others have said above, its your credit history that counts, ignore the other rubbish.

Jamesyb123

It’ll be the mortgage so the pointless number punishes you for being credit worthy and getting a mortgage, if you had just been a discharged bankrupt you’d have an excellent credit score which says it all really. You got the mortgage which is the end game for many so be happy with that.

DCFC79

What could be confusing things is when Martin talks about credit scores being affected on his TV show.

MalMonroe

I feel I was much better off when I was naive and didn't know anything about credit reports, credit scores or anything like it. I lived in complete ignorance and bliss - in short, I was happy! Now when I ever think about anything to do with money I panic about how it's going to affect my credit report rating, score, or whatever else. I've been told by representatives of three different financial institutions that they use their own scoring criteria - so I've decided to just ignore the blinkin' reports. I mean, there are three major ones as we speak. And every single person in the country has a report and there's absolutely nothing we can do about it. Financial institutions choose not to tell us the reasons for refusing us credit ("we recommend that you look at your credit reports") and it's all very big brotherish. I think it's time we peasants started revolting. Some people don't seem to care that credit report agencies smugly rate each and every one of us, sometimes leaving us  too scared to even buy ourselves a packet of Smarties! (My current fave). 

I really wouldn't worry, it sounds like you have your finger on the button where money's concerned. Your credit scores will be different for every agency and it'll go up and down like a yo-yo. Sometimes we may never know why. Keep us on our toes, maybe? I'm fed up with the whole thing!

MalMonroe

DCFC79 said:

What could be confusing things is when Martin talks about credit scores being affected on his TV show.

Yes, what's all that about?!

MaryNB

DCFC79 said:

What could be confusing things is when Martin talks about credit scores being affected on his TV show.

I tried to explain to a colleague earlier today that credit scores are meaningless. It was so hard to find proof to back this up. Everywhere mentions credit score. Martin has a whole article about improving credit scores and while he refers to the lenders' credit scoring systems you have to scroll much further down and then open a particular section to see that CRA credit scores don't mean anything. I'm not surprised most people stress about scores. I hadn't a clue they were irrelevant until I joined this forum. 

Ebe_Scrooge

MaryNB said:

DCFC79 said:

What could be confusing things is when Martin talks about credit scores being affected on his TV show.

 ... he refers to the lenders' credit scoring systems ...

Agreed, I'm sure this is the cause of a lot of confusion.  In a nutshell, the CRA's score is meaningless, but banks etc. definitely do generate their own internal score.  Each bank's criteria are very different, depending on their risk appetite, preferred demographic, and a whole host of other factors.  Their scoring criteria are confidential, commercially sensitive, and usually horribly complicated - at least, that's my experience as an IT guy who's had to trawl through the algorithms on a few occasions!  What doesn't help is when a customer is told by an employee that their score is not high enough - it's the internal score that counts, but many people (sometimes even the employee) assume it means the CRA score.

[Deleted User]

MalMonroe said:

I feel I was much better off when I was naive and didn't know anything about credit reports, credit scores or anything like it. I lived in complete ignorance and bliss - in short, I was happy! Now when I ever think about anything to do with money I panic about how it's going to affect my credit report rating, score, or whatever else. I've been told by representatives of three different financial institutions that they use their own scoring criteria - so I've decided to just ignore the blinkin' reports. I mean, there are three major ones as we speak. And every single person in the country has a report and there's absolutely nothing we can do about it. Financial institutions choose not to tell us the reasons for refusing us credit ("we recommend that you look at your credit reports") and it's all very big brotherish. I think it's time we peasants started revolting. Some people don't seem to care that credit report agencies smugly rate each and every one of us, sometimes leaving us  too scared to even buy ourselves a packet of Smarties! (My current fave). 

I really wouldn't worry, it sounds like you have your finger on the button where money's concerned. Your credit scores will be different for every agency and it'll go up and down like a yo-yo. Sometimes we may never know why. Keep us on our toes, maybe? I'm fed up with the whole thing!

Of course financial institutions don't tell you why they refused you credit - people would just learn how to game the system to get credit they shouldn't have. They aren't charities, why would you revolt if they choose not to lend to you? Nobody should care how the CRAs rate them as the CRAs don't lend money - all you should care about is ensuring your credit history is accurate and keep it in good order. Nothing big brother about it, they simply record your credit behaviour so that lenders know whether to lend to you or not based on their own criteria.