Frequently Asked Questions(FAQ)

How are credit scores calculated?

Credit scores are  determined based on factors like your payment history, your credit utilization ratio, the average length of your credit history, your credit mix, and the amount of new credit you have. 

Can a credit score drop for no reason?

Your credit score won't drop for no reason at all, but there are reasons your score could fall that you have no control over. For example, paying off a loan can cause your score to drop even though loans are designed to be paid off over time.

Why did my credit score randomly drop?

If your credit score dropped randomly, that could be an early sign of identity theft. We suggest reading over your credit reports at to check for credit report errors and accounts you don't recognize.

Why did my credit score drop after paying off debt?

Paying off a personal loan or another installment loan can reduce the types of credit you have, thus negatively affecting your credit mix. 


  1., "What's in my FICO® Scores?" Accessed April 18, 2023.
  2. VantageScore, "The Complete Guide to Your VantageScore." Accessed April 18, 2023.
  3. Experian, "What is a Credit Utilization Rate?" Accessed April 18, 2023.
  4. Consumer Financial Protection Bureau, "What are common credit report errors that I should look for on my credit report?" Accessed April 18, 2023.
  5. TransUnion, "How Long Does Bankruptcy Stay On Your Credit Report?" Accessed April 18, 2023.
  6. Equifax, "How Long Does Information Stay on My Equifax Credit Report?" Accessed April 18, 2023.
  7. Federal Trade Commission, "Using Credit Cards and Disputing Charges." Accessed April 18, 2023.
  8. Citizens Bank, "How to Release a Student Loan Co-Signer." Accessed April 18, 2023.

About the Authors

Holly Johnson

Written by: Holly Johnson

Award-Winning Personal Finance Contributor

I’m a professional writer who is obsessed with money, travel, and budgeting.

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