How I Lost More Than 100 Points From My Credit Score Even As a Responsible Adult (From the 700s To The 500s)

Isn’t it funny how little financial education we get in school? In both college and high school, we are given a ‘next to nothing’ education on managing our finances. Some of which includes managing a credit card, building your finances and securing loans. Yet we are expected to somehow know it all.

Before I go further into my story, I want to say that I am a responsible adult. I don’t overspend, party or live above my means. I don’t have college loans (got a full tuition scholarship), car note, or store credits. The only debt I have is from my credit card, and that is only because I used it to acquire a new laptop. I have had my credit cards for over two years, and I have maintained it fairly well. I have consistently been in the low 700’s. However, the last two months have sadly changed that. This is what happened.

Sometime in early November, I received my FICO report for the month of October and I saw my precious 720 score go down to 666. Okay first why the number 666? Is this the work of the antichrist? Secondly, what caused my credit to go down? I was paying 3 times a month, and was paying on time. My revolving utilization was okay, so I had no idea why my score had gone down drastically. I had two credit cards, one from USBANK and the other discover. Since Discover was my main line of credit, I went through my activity and saw nothing unusual.

Anyway, I waved it off as probably ‘one of those things’ and decided to keep paying with hopes that it will bring my credit up again.

Of course that did not happen. Instead my score went down from 666 to the high 500 when my December report came in. When I looked at the report, I froze and tears slowly rolled down my eyes. I had no idea what was happening. I was paying monthly, but my score was going down instead of going up (or staying static).

During this period, I called my school to get my official transcript which I needed for an unrelated application. The student’s account manager told me this was not possible as my account was on hold.

Wait a minute, my account on hold? How is that possible?

The manager told me that my account had a hold because I was owing $140. I knew this was impossible because after graduation from my college, you would not be given your diploma till your debt was all cleared, and I had gotten my diploma about a year ago. I explained to the student’s manager that I had already graduated and gotten my diploma so there was no way I could owe anything. I told her there was probably a mistake on their end, and asked if she could confirm.

She then goes, “Are you an international student?” I replied affirmative and she told me the $140 was a tax from $500 which I had been awarded by the school.

• Side Note, international students pay tax on any kind of aid they get from their school. Yes I paid taxes on the scholarships I received.

After my graduation in December 2020, I had gotten $500 from my college. This money was taxed in the amount of $60 which appeared on my college account after I had left. My school never called, emailed or mailed me to inform me about this pending debt. I only knew about it from calling to request for my transcript. After the student’s manager explained in detail what was wrong, I paid off the $140 and got my transcript. I thought it was all over, but this was where things got more interesting.

I was always watching finance videos to know how to be more successful. In addition, I would always check my bank app to make sure my transactions matched, and there was no funny business with my money. I had checked my app two days ago and saw the payment I made to my USBANK credit card was yet to show up. It was the third day, and I wanted to contact the bank to make sure the payment actually went through.

Going through the bank app, I click on the last option of ‘help’ and see a credit option. Then I see more details about my credit. Holy Moly! I had no idea this existed in my USBANK app. I had always used Discover as my main credit line and did not know my other credit line had these details.

I went through each section, painfully looking at my new score in the high 500s and that was where I got to the financial report. There, I saw that my school had sent the $60 I was owing to a collector and it had been on my credit report for more than 90 days, accumulating interest till it was $140.

At this point, everything clicked and it all made sense. My credit score going down even as I consistently paid and maintained a good revolving utilization. I was shocked beyond words. I was angry with my school for not mailing or emailing me that I had some debt to be cleared but instead sent it to a collection. Did they not understand the impact this would have?

I went through the report slowly, checking each date before shedding another tear. I felt like my dream of buying a house in a year had slipped from me. When I finally closed the app, I made two resolutions

1. I would never donate to my school no matter what
2. I would be as financially literate as possible

This all happened about two days ago, so I am on the journey of repairing my credit. As an international student, life in the US is already hard without family, and I was opposed to anything making it harder for me. However, I learned a few lessons from this event.

1. Never assume a significant drop in credit score is ‘just life’
2. Financial literacy is gold and ignorance is indeed a disease
3. Life throws curveballs at you (no matter how meticulously you plan)
4. Bad things do happen to good people

PS: If you have any ideas on how to go about my credit repair journey, Please let me know in the comments. Also, be kind to share this story to your friends, frenemies and maybe enemies? Remember I am on the ‘one post a day for 200 days challenge.’

Are you interested in studying in the United States, or are you an incoming freshman in a US college? Do you love stories on financial growth or fiction? Be sure to check out my Instagram, YouTube and website where I document my experiences.