Which factor can negatively impact a credit score?

Late payment history is a major factor that negatively impacts a credit score. Payment history is one of the most significant components of a credit score calculation, typically accounting for around 35% of the score. When a consumer fails to make payments on time, it signals to creditors that they may be a higher risk for future loans. This can lead to a lower credit score, making it difficult for the individual to secure new credit or obtain favorable interest rates on loans. Consistent late payments can accumulate and have a lasting effect, remaining on the credit report for several years, which can hinder the ability to borrow in the future and potentially result in higher costs for loans due to increased interest rates.