4 credit score horror stories that could happen to anyone

A person’s credit score determines the likelihood they’ll repay debt.Simple mistakes or oversights can sink a credit score.Getting caught up in life events such as the purchase of a new home or going on vacation can make it easy to overlook seemingly minor financial mistakes.Thankfully, all of the people in these credit score horror stories recovered from their lowered scores, and many of them are financial professionals today.Visit BusinessInsider.com for more stories. Credit scores determine so much about a person’s financial life. It’s set to determine how likely an individual is to repay debt, but it might as well act as the report card of adulthood. Many people run into major predicaments with credit score problems, including smart, successful, and financially savvy people (like the ones mentioned here). As these credit score horror stories show, it’s easy to make those crucial digits drop with an honest mistake or simple oversight. Here’s how simple blunders from a moving day or honeymoon can linger on your financial record for months later. Paying off debt early made my credit score drop 40 to 50 points When it comes to credit scores, it helps to read the fine print. “About nine years ago, I was getting close to buying a house, and taking out a mortgage,” said Matt Schmidt, CEO of Diabetes Life Solutions. He decided to pay off the balance of his student loan debt ahead of schedule, which seemed like a smart idea at the time. This seemingly responsible behavior backfired. “My student loan was my only type of ‘installment’ debt. Even though I paid off my debt, FICO penalized me for not having installment debt,” said Schmidt. This penalty resulted in a rather serious credit score impact. “My credit score dropped 40-50 points, and took about four months to get it
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