I use Mogo to review my credit score every month.

I just moved to Canada so it took a while to even kickstart my rating, however, Mogos history shows.

Dec (2 months after I got my credit card) - 648 .
Jan - 662 (+14) .
Feb - 668 (+6) .
Mar - 647 (-21) .

What on earth happened here. I can confirm every bill has been paid on time. I only have one credit card, and I pay a phone bill, rent, and hydro.

So what would cause a substantial drop like this? I've never maxed my card (although I did utilise maybe 70% of it during Feb, but paid it off already.

Is this something to worry about, will it just keep going down by huge jumps like this every month, even if I spend it and pay it all back?


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    Did you pay the card off before the statement date or did you wait until you got a bill? A 70% utilization will definitely reduce your score, but will only be reported to the credit agencies if it reaches the statement date.
    – Nosjack
    Mar 1 '19 at 20:15
  • I actually don't take much notice. I tend to pay it off twice a month. Meaning usually before I get a bill I pay it back down to a reasonable amount. And then again later in the month (after the statement date, I get paid twice a month). Mar 1 '19 at 21:14
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    Is 21 points really that big a change?
    – chepner
    Mar 1 '19 at 21:24
  • Have you run your full credit report? That is the best way to investigate. There is always the change of identify theft or incorrect information on your reports. Your score alone won't tall you that. Check AnnualCreditReport.com for a free copy of your report from all three agencies (you can do this once per year each)
    – JohnFx
    Mar 1 '19 at 22:58
  • @chepner When the scores is 600+ no, it's not a big change. However take that value relative to the increases I get on a regular month, it IS a big change. If an increase of 3 - 6 points a month is the normal, then a 21 point decrease is 4 times that amount in the negative direction. Seems a heavy penalty considering I've been TRYING to keep my credit on the increase. Mar 1 '19 at 23:29

While credit scores are somewhat of a black box, most credit reporting agencies will penalize your score if you have a high utilization (credit used compared to credit limit) at the time your credit card company reports the balance to them. In my experience (USA) these reports happen roughly once monthly, shortly before your statement comes due.

This drop is likely due to your high utilization during February. I wouldn't worry about it (or your credit score in general) unless you plan on using credit for something new very soon (mortgage, car note, etc. not just using a CC)

@OP raised concerns of their score permanently lowering every time they had a high utilization on their CC or other revolving credit accounts. To make it clear for everyone, credit drops due to high utilization are temporary, and reflect a snapshot in time recalculation of your score, not a permanent loss that must then be recouped over several months. Most reporting agencies recommend you not exceed 30% utilization, with 7% or less being ideal. What this means is, ONLY when you anticipate needing to take a large loan or line of credit (think mortgage or car note), you should pay off your cards earlier so the statement reporting shows less than 7% utilization BEFORE you apply for the loan. Credit score is just a way to verify your identity hasn't been compromised, even 50 point swings are not a concern when you don't need a large loan.

I spent 2 months without putting more than 30USD on credit before applying for a mortgage (December'17/January'18) and my score jumped nearly 30 points. Still not worth sweating it when you're not buying something large.

  • Okay so its not unusual to see a drop that appears large (set me back 3 months worth of gains)? I only worry because it dropped it to the "fair" range from "good" and I want to make sure I have a great credit rating. Not yet, but in the next 5 years I am looking to buy property. I guess I like keeping an eye on my score each month so I can get an idea of what causes the fluctuations so I can put myself in a good position in the future. Mar 1 '19 at 20:30
  • @confused_antelope This drop will most likely go away within a couple months, as long as you stay below 30% or so utilization on your credit cards.
    – Nosjack
    Mar 1 '19 at 20:44
  • Sounds good. My concern is that if I put through one large transaction on my CC once every 3 months. I'm gonna undo what I've gained. If I was to do this every 3 months for a few years. Then in 2021 for example, my credit rating wouldn't be any better. Mar 1 '19 at 20:47
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    @confused_antelope the point is that the gains you make are permanent as they’re building up a good history, whereas this penalty is temporary as your credit utilization spiked but the next credit report will show you already paid it off.
    – Wildcard
    Mar 2 '19 at 0:38
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    If this was triggered by an unusually high balance and you pay it down immediately I'd expect it to go away completely on your next report. I used to see a 15-20 point one month dip every year after Christmas because my - always paid in full - credit carts would have a large block of gift giving in addition to my normal monthly expenses. The following month with my statement balance back to normal so was my score. Mar 2 '19 at 19:24

My concern is that if I put through one large transaction on my CC once every 3 months.

I'd like to provide an answer to just this concern. The accepted answer covers the real issue, the larger issue, that small swings are meaningless over time and you should just be aware before applying for credit.

As someone who likes to know the smallest of financial details, I began to monitor my score and found that if I wished to game the system, maximize my score, the real issue wasn't spending, it was payment timing.

In other words, I would make a large payment to credit the account the day before the bill was cut. I managed to pin our scores to 850 via this method, and when applying for a renewal of my HELOC, after retirement, was pleasantly surprised to hear the agent mumble "holy crap". Huh? She then said,"Oh, sorry, I'd just never seen a couple who both had 850 scores before."

That said, one of my cards changed banks, and while the billing cycle never changed, the reporting cycle did. The bill gets issued on the 15th, but the balance on the last day of the month is what started getting reported. One month of a huge drop in score, a lesson learned, and now I pay the card twice each month, on the date the payment is due, but again on the 30th to zero out the balance reported.

All this effort is not needed for anyone who doesn't really care about those last few points. It's easy enough to get the reported balance to near zero ahead of an important event, again, as noted.

Note - there are free services that offer a simulated credit score, Credit Karma among them. It offers an easy way to see when your accounts last reported your activity. I get my FICO score from other sources, but while the score is more accurate, the supporting details are lacking. For those who are a bit obsessed, it takes a few sources of data to provide the whole picture.

  • 1
    Hi, thank you for addressing this too. I'm the same in that I always like to look at the smallest financial details, and due to this I get very competitive with myself on small issues like "my credit score dropped, how do I embiggen this number again". Thanks for your story! I will most likely start to monitor when the best time to pay off my cards are, as you have done. :) Mar 4 '19 at 19:51

It's not a large change, and it will bounce back next month right away (assuming you pay your bills, etc.)

Often, a simple shift of a day back or forth in a month because of weekends moves the reporting day, and with that, the amount owed / pntage of credit used.

[I am seeing 20+ points up and downs every month, since years, swinging around between 805 and 845, without me doing anything different]

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