Why did my credit score drop when I move?

Understanding Credit Score Drops After Moving

It can be unsettling to discover a sudden drop in your credit score after relocating. While your credit score should generally remain stable during an address change, certain unforeseen factors can lead to a decline.

Common Culprits for Credit Score Drops:

• Incorrect Reporting: Errors on your credit report, such as incorrect payment histories or account balances, can negatively impact your score.

• Missed Payments: Even a single missed payment can have a significant impact on your credit score, especially if it remains unpaid for an extended period.

• Account Changes: Opening or closing credit accounts, including those related to your move (e.g., closing your old utility accounts), can affect your credit utilization ratio and other factors that influence your score.

Investigating the Cause:

If you notice a drop in your credit score after moving, it’s crucial to identify the cause. Request a free copy of your credit report from each of the three major credit bureaus (Equifax, Experian, and TransUnion) to review for any inaccuracies or missed payments.

Immediate Action to Recover:

Once you have identified the reason for the drop, take immediate action to resolve the issue:

• Dispute Errors: If you find any inaccuracies on your credit report, file a dispute with the credit bureau. Provide supporting documentation to prove your claim.

• Make Payments on Time: Ensure that all your bills are paid on time, particularly credit cards and other accounts that report to credit bureaus.

• Monitor Your Credit: Keep track of your credit report regularly to monitor for any changes or potential issues.

Additional Tips:

• Limit Credit Inquiries: Avoid making multiple credit inquiries within a short period, as each inquiry can temporarily lower your score.

• Maintain a Low Credit Utilization Ratio: Use less than 30% of your available credit limits, as high credit utilization can indicate financial stress.

• Build a Positive Credit History: Establish a track record of responsible credit use by making timely payments and keeping your accounts open.

Conclusion:

While a credit score drop after moving can be alarming, it’s important to understand the potential causes and take appropriate action. By investigating your credit report and resolving any issues promptly, you can improve your credit score and prevent further damage. Remember to monitor your credit regularly and practice responsible credit habits to maintain a healthy financial profile.