Paying off debts may temporarily lower your credit score due to factors like increased credit utilization ratio, decreased average credit account age, and reduced types of credit accounts. However, these effects are usually temporary, and your score should bounce back within a few months. To minimize the impact, manage credit utilization, maintain older accounts, diversify credit types, and monitor your credit report for errors. It’s also important to continue making timely payments to support the recovery of your credit score.
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