What Is A Credit Score Jump?
Credit scores change over time; this is usually a very gradual process. Sometimes, a credit score will drop quickly, or even jump up by an unexpected amount.
It’s easy to figure out what might drop one’s credit score quickly—bankruptcy, foreclosure, a charged-off account, etc. But sometimes one’s credit score will jump up without any obvious reason.
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Reasons for a credit score jump
If we investigate closely, it is usually possible to figure out why one’s credit score might have gone up quickly. Here are some common reasons for a credit score jump:
• Average Age of Accounts: the age of your accounts has an impact on your score. Over time, the longer your established accounts remain in good standing, the better your score. If you were to close a recently opened account, leaving only older, better-established accounts, then your score might jump up as a result. (See “Credit score scale factors: Length of credit history.”)
• Expired entries: everything on your credit report has a finite lifespan. A tax lien can stay on your account for 7 years after you pay it off. A court judgment can stay for 7 years as well. Bankruptcy usually lasts for 10 years. These durations vary depending on the kind of debt, and the state law where you reside. When the statute of limitations expires on these debts, they should drop off of your report and stop impacting your score. If you had some serious credit trouble 7 or 10 years ago, that might explain why your credit score jumped today. (See “How long must negative credit report items report for?”)
• Successful dispute: if you have something incorrect on your credit report, you’ll want to dispute it and have it removed. If you succeed, it will stop impacting your score when it is taken off, bringing your score back up to where it should be. (See “What Can I Dispute on My Credit Report?”)
• Mistaken calculation: unfortunately, sometimes the credit bureaus make mistakes, and the score you see is incorrect. Some people see a sudden jump in their credit score, only to see those extra points go away in a few months when the credit bureau corrects their mistake. (See “Why you MUST check your credit reports regularly.”)
• Different scoring model: it’s important not to compare your FICO score to your VantageScore directly. We’ve seen clients get their VantageScores and see them be higher than their FICO score; this doesn’t mean your FICO score has improved. Make sure you check the same scoring model each time to be sure your score is actually improving. (See “Recent Changes to VantageScores Benefit Consumers.”)
If your credit score has changed suddenly and you have questions about it, give us a call for free, confidential credit counseling.
