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We all like to think we know how credit scores are calculated. We know that black marks on your credit report can decrease your score and making all your repayments on time can improve your score. However, the exact calculation is a heavily guarded secret that the credit reporting bodies are unlikely to share with us. So, here are three things that affect your score that you might not know about.

 

1. A credit card limit increase

Each time you apply for a credit card, a credit enquiry can be recorded on your credit report. These enquiries stay on your report for five years and can impact your score. Similarly, if you accept a credit card limit increase, your provider can perform another credit check on you, resulting in another credit enquiry on your report. As we always say, only apply for credit if and when you really need it and think twice before accepting that limit increase.

 

For more information, check out our article: Can a credit card limit increase hurt your credit score?

 

2. Joint credit accounts

If you have joint credit accounts with your partner, any credit report entries related to that account (such as credit enquiries and late payments) will appear on both you and your partner’s credit reports. You are both responsible for the account, even if you aren’t the one doing all the spending or managing the account.

 

Keen to learn more? Read our article: Do your credit reports get merged when you get married?

 

3. Errors

If there is a mistake on your credit report, you’re the only one that’s going to spot it. Errors on credit reports are not uncommon, it could be a duplicate or incorrect entry, or it could be that the information was simply not updated when it should have. You want your credit report to be accurate and up to date, so it’s important to check and monitor your credit report and credit score. Bonus, you can do it for free at Credit Savvy!

 

Got a mistake on your report? Check out our article: How do I fix an error on my credit report?