Why has my credit score gone down? Reasons your score may have dropped

If you’ve just checked your credit score, and it’s gone down, it might feel confusing or even unfair. You’re making smart money moves, paying attention, and then suddenly that number dips… 

Don’t panic, your credit score won’t drop for no reason. This is just a gentle nudge that you have something to investigate. It could be a sign your credit report needs some TLC, or that the credit reference agencies have updated your information. 

Things that can change your score include: 

• Missed or late payments
• High credit utilisation
• Opening new accounts, or closing older ones.

And don’t worry about lenders' interpretation of your score. Did you know that lenders are only checking your credit report? A credit report is a detailed record of how you’ve managed money over time. 

Your score is a tool to help you understand how lenders might view you. 

Once you understand what’s behind the drop, you can stop guessing and make your next money move with confidence.

We’re going to give you a few practical ways to feel back in control, and all being well, get your credit score trending upward.

Let’s get to the bottom of why your credit score dropped, and help you start improving it again.

Why is my credit score going down?

Your credit score can change whenever the credit reference agencies (CRAs) — Equifax, Experian and TransUnion — get new information about you. 

Sometimes, those updates can make you look like a riskier borrower, even if you’re making considered money choices, and nothing major has changed. 

Don’t let it shake your confidence. This is a chance to fine-tune your moves, to influence how you show up in the credit report.

Here are some of the most common reasons why your score might drop. 

1. You have missed or late payments

 Even one missed or late payment can damage your credit report. Lenders report them to the CRAs, and those records can show for up to six years. 

That said, life happens. Common reasons for missed payments include: 

• Expired cards
• Bank account changes
• Payments fail because you don’t  have enough money in your account

The important thing is to deal with missed or delayed payments as quickly as possible. 

Loqbox tip: Set up Direct Debits or reminders for regular bills, so that nothing slips through. If it does, catch up as quickly as possible and communicate with your lender. 

2. You’ve moved house

Lenders see long-term stability, like having the same address for a long time, as a sign of financial reliability. So, when you move or if your address changes often, your credit score might drop. 

‍

‍

3.Applying for credit

When you apply for credit, lenders often run a hard credit check,  leaving a record on your report. 

Making lots of applications in a short space of time can make it look like you’re urgently seeking credit, which can cause your score to fall. 

Loqbox tip: Space out your credit applications, and consider using an eligibility checker (a soft check that doesn’t affect your score) to see if you’re likely to be accepted. That way, you can plan without leaving marks on your report.  

4.Mistakes on your credit report

Sometimes, your score can drop because of errors in your credit history. Things like: 

• Missed or late payments (that weren’t missed or late)
• Old financial connections that are no longer relevant
• Incorrect names or addresses  

Loqbox tip: The best way to avoid this is to check your reports regularly and report any mistakes. This smart money habit can also help you keep yourself safe from fraud and identity theft. 

5. High credit utilisation

‘Credit utilisation’ is just a fancy way of saying ‘this is how much of your credit you’re using’. 

High credit use is one of the most common reasons for a credit score dip. 

For example, if your credit limit is £1,000, and you spend £500, your credit utilisation ratio would be 50%. 

Using a high amount of your available credit, usually more than 30%, can make lenders think you’re too reliant on borrowing, even if you’re managing it well. 

Keeping your utilisation low shows you’re using credit responsibly. 

Loqbox tip: Aim to use no more than 25-30% of your available credit across all your accounts. Even paying down small amounts could give your score a lift. Learn more in our guide. 

6. Opening or closing accounts

When you open or close an account, a few things can affect your credit history: 

• Hard credit checks: New applications can leave a mark on your report, which can lower your score temporarily. 
• Credit utilisation: Closing an account reduces your overall available credit, which can increase your credit utilisation. 
• Average accounts age: Closing older accounts shortens your credit history, which can make you look less established. 

These shifts aren’t “bad”, but they can take some time to balance out. 

Loqbox tip: Try to avoid opening or closing several accounts in a short space of time. Let your accounts age naturally, and keep balances consistent. A calm, steady credit history is a lender’s dream. 

Okay, what now?

A dip in your credit score isn’t the end of the world. It’s just data that tells you how to move forward. Try to think about it as feedback about something you can change. 

Scores shift all the time, and that means they can move up again, too. They also vary between CRAs, and they’re interpreted differently by lenders. It’s not the be-all and end-all. 

Now’s the time to back yourself. Building credit isn’t about quick fixes. As you quietly make progress, you’re also moving steadily towards your money goals. Keep showing up for your future self, one money move at a time. 

How to get your score back on the up

Check all three of your credit reports — with Equifax, Experian and TransUnion — and review them against the list above to work out why your score’s changed. Then, make small habit changes that add up: 

• Keep your credit use low: Less than 25% shows you’re in control
• Pay on time, every time: Consistency counts
• Stay on the electoral roll: Help lenders confirm your identity and address history
• Check your reports regularly: Spot mistakes early and fix them
• Join Loqbox: Discover how Loqbox membership could help you build credit, the easy way

Improvements to your credit score are not guaranteed.