Credit Scores: Don't Sweat Small Dips

Credit Scores: Don't Sweat Small Dips.

- Kimberly Lankford

RECENTLY, MY CREDIT SCORE DROPPED from “exceptional” to “very good.” I had put a security freeze on all of my credit reports and closed out an auto loan. Did either action cause my score to drop?

J.B., COLGATE, WIS.

No. A credit freeze doesn’t hurt your credit score; it just prohibits new lenders from accessing your credit report, which can help protect you from identity theft. And paying off an auto loan doesn’t cause a score to drop—although it’s unlikely to help much, either, because installment debt has a minimal impact on your score, says credit expert John Ulzheimer.