Can't understand why my credit score has nose dived 19 March 2022 at 8:03PM in Credit file & ratings 6 replies 302 views

shennan

I get that credit scores fluctuate, and I also know that opening new accounts can have an adverse affect. What I can't quite understand is why my score has nose dived by so much.

Looking at my "Credit Karma" account, my score has gone from "Excellent" to "Fair" (loosing 60 points) since December 2021.

I have opened some new accounts, but I've not opened any new Credit Card accounts and I've not missed any payments on the Credit Cards. In terms of accounts, I've opened an HSBC Current Account for managing a wedding with my partner, and an HSBC Executor account for my late fathers estate. I did make a big purchase on one of my credit cards but I also paid it off fully from savings before it was due.

Can you really lose 60 points for opening two new bank accounts with no added debt?

Would just like to get a sense of whether this is bad and if there's anything I can do about it? Unfortunately, because I'm executor of my fathers estate and the wedding, I need to keep the accounts open. How quickly will I be able to recover from all this after I'm able to close them?

Any help to understand will be very welcome. Thanks.

theoretica

Is the wedding account joint with your partner, and is this the first joint financial product you have?  It could be that your credit record is now linked to theirs.

Don't gamify the 'score' - if you have not been turned down for anything your credit record is good enough.

[Deleted User]

shennan said:

Can you really lose 60 points for opening two new bank accounts with no added debt?

You can lose 60 points for wearing the wrong colour pants.

But in the real world, nothing you have done will cause lenders any concern.

[Deleted User]

Just down and right from the "create post" button on the forum (at least on a desktop) there is a sticky thread What your credit score really means - you would have seen it when you came to this sub. You don't have a credit score, the gimmick number is solely there to trick you into paying for "improvement" services provided by the same people who provide the score - what a happy coincidence!

No lender ever sees your score. No decision on lending is ever made based on that score. Ignore it, just make sure your credit files are correct

shennan

theoretica said:

Is the wedding account joint with your partner, and is this the first joint financial product you have?  It could be that your credit record is now linked to theirs.

Don't gamify the 'score' - if you have not been turned down for anything your credit record is good enough.

No the wedding account is just in my name. Although we do have a joint account (for mortgage and bills).

Deleted_User said:

Just down and right from the "create post" button on the forum (at least on a desktop) there is a sticky thread What your credit score really means - you would have seen it when you came to this sub. You don't have a credit score, the gimmick number is solely there to trick you into paying for "improvement" services provided by the same people who provide the score - what a happy coincidence!

No lender ever sees your score. No decision on lending is ever made based on that score. Ignore it, just make sure your credit files are correct

Ok this is useful to know. As far as I know there's nothing wrong with my finances. Obviously I'm slightly concerned that someone may have opened something without my knowledge; but looking through the Credit Karma app I can't see any activity that wasn't as a result of me. I assume I would see an "event" that I wouldn't recognise.

penners324

Opening 2 new accounts and your credit card utilisation on the last day of the month being over 30% will certainly cause your score to drop by 60 points.

Next month it will go up by 30 probably 

MalMonroe

As shennan has said, your credit score means nothing. A clean, neat and tidy credit report is what lenders are looking for, they don't see the credit score that you see. They all have their own lending criteria and their own scoring systems.

I always find Credit Karma gives much lower scores than the other agencies. This month I'm at 1000 with Clearscore but the score with Credit Karma is 'good' and they always have some advice for me on how to improve my score. In reality, there's absolutely nothing I can do. Talk about harbingers of doom!

Don't be disheartened, as penners324 says above, it'll probably go up again next month. Also check your other credit reports, Equifax (Clearscore) and Experian (via this site). They will probably give better scores. It can't just be me who has a consistently rubbish CK score?  But then again, it's all immaterial because nobody else sees that score.