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concerneduser1

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Credit Score Dropped 150 Points
My credit score dropped 150 points last week and I'm really confused as to why and also how to I recover from this as I'm about to buy a new car/house soon.

A little background: I'm currently 24 years old and have always had a credit score in the mid 700's. My credit card utilization is at 0%(always pay off fully before due date), I've never missed a payment(300/300), and have 0 derogatory marks.

I understand that the age of my credit history isnt great as I'm still young. I had 1 credit card during college that i only used for groceries and always paid off early in full. I decided to get a better credit card last month to get some of the cash rewards. Ever since that happened my credit card score has plummeted which i dont understand as it would increase my total number of accounts..

Can anyone shed some light on what is happening here and what i can do it correct this(or how long this will take to recover from). Thanks!

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It sounds like this is most likely it is due to a hard credit inquiry as well as a drop in average age of credit. Since you had always maintained a 0 balance on your other cards you did not effect your credit usage/avalaible in a positive way to offset the age of credit.

Also if you closed your other credit card then your average age of credit really dropped almost to 0years I bet.

I believe it is one year for the hard inquiry to drop and then it is just time to get the average age back up

Depending on how low your FICO dropped and what methodology your mortgage broker uses you maybe still able to get a home loan with a letter to the underwriter. Realize their model may not use average age to the same weight as others do.  Also wait at least 4 months before appling for a mortgage as they do frown on new credit less than 90 days reported. Car loans is whole other animal and the models they use and I can not help as much there, but you can get a loan, the interest rate maybe a different story.

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Check your FICO scores, they are the important ones and they most likely did not drop like this.

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