Wednesday, 17 September 2025

Top 5 Mistakes Hurting Your Credit Without You Realising

Your credit score is like a financial report card. It tells lenders whether you’re reliable with money — and it can be the difference between getting approved for finance at a great rate, or being declined altogether. 

The problem is, many people damage their credit without even realising it. Here are the top five mistakes that could be quietly dragging your score down.

 

  1. Making Late or Missed Payments

Even a single late repayment on a loan, credit card, or phone bill can leave a black mark on your credit file. Repayment history makes up a significant portion of your credit score, and defaults can stay on your report for five years. 

Tip: Set up automatic payments or reminders to make sure you never miss a due date. 

 

  1. Applying for Too Much Credit at Once

Every time you apply for a loan, credit card, or buy-now-pay-later account, a “hard inquiry” gets recorded. Too many of these in a short space of time signals to lenders that you might be desperate for credit — and it can seriously lower your score. 

Tip: Only apply when you need to, and do your research before submitting applications. 

 

  1. Ignoring Small Bills or Accounts

It’s easy to brush off a $200 phone bill or an overdue gym membership, but these small amounts can quickly turn into a default if left unpaid. Defaults — no matter the size — are among the most damaging marks on your credit report. 

Tip: Keep track of every account in your name, even if it’s small, and close old accounts you no longer use. 

 

  1. Not Checking Your Credit Report

Errors happen more often than you’d think — from debts listed twice, to accounts that aren’t even yours. If left unchallenged, these mistakes can hold your score back and stop you from getting approved. 

Tip: Check your credit report at least once a year with all three bureaus (Equifax, Experian, and illion) and dispute any errors. 

 

  1. Only Paying the Minimum on Credit Cards

Paying just the minimum keeps your account in good standing, but it also means your debt lingers. High balances relative to your limit can hurt your “credit utilisation ratio” — a key factor lenders use to judge risk. 

Tip: Aim to pay more than the minimum each month, even if it’s just a little extra. 

 

Final Thoughts 

Your credit score isn’t just about avoiding big mistakes — it’s about staying on top of the small things that add up over time. By avoiding these five common pitfalls, you’ll protect your financial reputation and put yourself in a stronger position for the future.