Credit Score Spoilers

Many people are aware of the big ticket items that can damage a credit score, but there are several little items that can drop a credit score quickly if not handled correctly. In efforts to protect credit scores, monitoring your credit report and being vigilant about these few spoilers can prevent you from suffering unnecessary credit troubles.

Tax Liens

Tax debts can be quite problematic for taxpayers. Besides the fact the IRS has many more tricks up their sleeve for collections than a traditional debt collector, their consequences can be more severe. The IRS can, and does, report to credit bureaus when tax debts become severely delinquent. IRS tax lien notifications to a credit agency can also last as long as 15 years on your credit report. Resolving tax debts is of utmost priority.

Credit Inquiries

Anytime you apply for a loan or authorize a potential creditor to check your credit report, the credit bureau considers this an inquiry. Too many inquiries can be detrimental to your credit report. Multiple inquiries signal a lot of interest in your borrowing potential, but may also communicate the rejection of those previous creditors. Never allow a potential creditor to check your credit report unless absolutely necessary or with serious interest in obtaining a loan.

Small Debts

While most of us are aware that unpaid debts to credit cards and medical companies can result in penalties and credit damage, many people never consider the effects of utility bills on their credit. Even if you paid a security deposit to the company when setting up service, the utility company may still be able to report your delinquency or debt default to a credit agency.  Items such as unpaid library fines and even parking tickets may also be reported on your credit report. Luckily, debt negotiations can be used even to reduce the payments on items like these.