When you notice that your credit score had dropped, you start to question many things. We try to pay our bills on time, at the right amount, and keep our credit usage at a minimum but sometimes we fail. We aren’t perfect, but one small mistake can reflect on your overall credit score.

If you notice a drop, it is most likely due to something specific. Here is a list of the most common reason this happens:

You Were Late or Missed a Payment

Your payment history is one of the most influential factors to your overall credit score. Missing just one payment can negatively impact your credit. It is important to stay up to date on things such as due dates and minimum payment amounts.

2. You Applied for a Loan or a New Credit Card

Maybe you found a new credit card that appeals to you or you just took our a loan for school, a vehicle, or home renovation. Unfortunately, as exciting as these can be, it can be less exciting for your credit score. Any time you authorize someone, such as a credit card company or lender to check your credit report, you may notice your score took a hit. This is known as an inquiry. It is important be sure the credit you applied for is worth the hit and will be valuable in the long run. It doesn’t have to be a scary process if you are prepared!

3. Your Credit Utilization Has Gone Up

It is easy to make a charged payment and think that you will pay it off later. It is such an easy and convenient process that we don’t realize how charges can add up quickly. You may end up lowering your credit score depending on the card’s credit limit, maxing out the card, making larges purchases, or continuing to make small payments. You should monitor your charges and keep them below 30% of the credit limit.

4. You Closed a Credit Card Account

Closing out a credit card, especially if it one of your oldest will reduce the age of your credit history. Your credit history is another factor that impacts your credit score. The longer you have a card or account open shows that you are able to maintain a credit card over time. You should consider keeping the card unless it has a high annual fee. Keeping it open will help maintain your overall credit limit and credit history.