Reply
Frequent Contributor
hobojon
Posts: 261
Registered: ‎01-20-2009

Re: Credit Card Usage for high FICO score


creditwherecreditisdue wrote:

I have posted elsewhere here that this account aging is a FICO scam perpetrated by AMEX and a great way to "game" the FICO system. In your case you used it in combination with the AU scam, another great way to "game" the system. I fully endorse the use of these and any other ways to gain advantage over the FICO scoring models as long as they last. Just don't be too shocked when the CRB's decide any particular method of manipulating the system is out.


 

If you think this is a scam why on earth would you fully endorse it?

 You said there was no way to increase your average age.

I will tell my spouse I perpetrated two scams and gamed the system in order to increase her fico score but since you said it was OK we should be alright.

Moderator Emerita
Community Leader
Epic Contributor
haulingthescoreup
Posts: 28,115
Registered: ‎04-01-2007

Re: Credit Card Usage for high FICO score


creditwherecreditisdue wrote:

This advice runs contrary to all accumulated FICO wisdom and experience other that yours.



(This was in reply to a post that the member's scores do better with util <1%.)

But I have found this to be true for my scores as well. My scores are optimum with less than 1% util reporting. Of course, the figure is rounded up on the score reports to 1%, but if I suddenly had 5% report, there would be a drop. I've seen this with all three reports.

My "sweet spot" for scoring is 1 or 2 CC's with a balance on EQ, and 1 CC with a balance on TU, both with <1% util. Back in the day, EX was like EQ for me --2 CC's were OK. This is with 11 open CC's, a mortgage, a car loan, and a HELOC (not factored in my util because of the $50K CL.) Total revolving CL, excluding the HELOC, is $131K. It's not a huge score ding, maybe 3-5 points different, but at this stage in my credit life, torturing my scores is about my only remaining entertainment. (Besides the forums, that is.)

When you get down to this level of minutiae --util, # of cards with balances, etc --it very much becomes a matter of YMMV. My guess is that the differences are driven by age of accounts, but that's just a guess.

We generally recommend 1-9% here on the boards, because 9% or less is known to be helpful for util, and when someone has 50% util on their cards, they would pass out if you were to suggest 1%. The 9% freaks them out badly enough, as it is.s
* Credit is a wonderful servant, but a terrible master. * Who's the boss --you or your credit?
FICO's: EQ 781 - TU 793 - EX 779 (from PSECU) - Done credit hunting; having fun with credit gardening. - EQ 590 on 5/14/2007
Valued Contributor
Uborrow-Upay
Posts: 2,710
Registered: ‎10-16-2008

Re: Credit Card Usage for high FICO score

[ Edited ]

hobojon wrote:

creditwherecreditisdue wrote:

I have posted elsewhere here that this account aging is a FICO scam perpetrated by AMEX and a great way to "game" the FICO system. In your case you used it in combination with the AU scam, another great way to "game" the system. I fully endorse the use of these and any other ways to gain advantage over the FICO scoring models as long as they last. Just don't be too shocked when the CRB's decide any particular method of manipulating the system is out.


 

If you think this is a scam why on earth would you fully endorse it?

 You said there was no way to increase your average age.

I will tell my spouse I perpetrated two scams and gamed the system in order to increase her fico score but since you said it was OK we should be alright.


 

Amex has used its account aging system to increase its market penetration among savvy credit consumers, and it's an outstanding ploy.  I'm sure a lot of folks got /resurrected old Amex accounts just for the age (think 'Oasis program') and how that age could help lagging FICOs. 

 

hobo, I believe creditwherecreditisdue was commending you, not condemning you, for using that aging to improve your wife's scores.

 

It's fair game to utilize their rules to your advantage, just like arbitrage is fair (and used to be very profitable, too!)

 

Carry on...

 

(Edit to insert quote and remove unanticipated 'smiley'.)

(Edit again...for lousy spelling...GRRR!)

Message Edited by Uborrow-Upay on 07-16-2009 06:20 AM
Message Edited by Uborrow-Upay on 07-16-2009 06:58 AM
Frequent Contributor
hobojon
Posts: 261
Registered: ‎01-20-2009

Re: Credit Card Usage for high FICO score


Uborrow-Upay wrote:

The AU aspect of it may already have lost its effectiveness if it's not an actual AU account IN USE by the AU.

 

What I'm trying to say is that I believe the bogus (no-card-in-the-hands-of) AU accounts are being disregarded to some extent (if not totally) right now.   The "pay for piggybacking" on someone else's credit history did not go unnoticed by the CRBs or the lenders, and measures were taken to remove these artificial histories from being factored into individual scores, IMO.

 

Feel free to chime in if anyone else here has real evidence of this, because I'm basing my opinion solely on input from a handful of folks I know with AU accounts but no accompanying cards or actual usage on the accounts by the AU.


I hope that when FICO 08 is adopted and used, if they ever do, that this version somehow eliminates the benefits gained by purchased tradelines. I think it is scummy. As far as legitimate AU's, spouses and other household members. I don't think that will ever happen. I believe it is prohibited by the ECOA.

 I have never used any of my recently acquired 20 y/o Amex cards nor have my designated AU's and we both certainly have received the benefits of the cards credit limits and age.

Valued Contributor
Uborrow-Upay
Posts: 2,710
Registered: ‎10-16-2008

Re: Credit Card Usage for high FICO score


hobojon wrote:

Uborrow-Upay wrote:

The AU aspect of it may already have lost its effectiveness if it's not an actual AU account IN USE by the AU.

 

What I'm trying to say is that I believe the bogus (no-card-in-the-hands-of) AU accounts are being disregarded to some extent (if not totally) right now.   The "pay for piggybacking" on someone else's credit history did not go unnoticed by the CRBs or the lenders, and measures were taken to remove these artificial histories from being factored into individual scores, IMO.

 

Feel free to chime in if anyone else here has real evidence of this, because I'm basing my opinion solely on input from a handful of folks I know with AU accounts but no accompanying cards or actual usage on the accounts by the AU.


I hope that when FICO 08 is adopted and used, if they ever do, that this version somehow eliminates the benefits gained by purchased tradelines. I think it is scummy. As far as legitimate AU's, spouses and other household members. I don't think that will ever happen. I believe it is prohibited by the ECOA.

 I have never used any of my recently acquired 20 y/o Amex cards nor have my designated AU's and we both certainly have received the benefits of the cards credit limits and age.


True enough!  But you reside at the same address, which may indicate true AU status for DW.

 

I think AU's with an address different than that of the primary might fall under what I've outlined above.  Again, just my opinion from limited observations.

 

 

Frequent Contributor
hobojon
Posts: 261
Registered: ‎01-20-2009

Re: Credit Card Usage for high FICO score

[ Edited ]

Uborrow-Upay wrote:

Amex has used its account aging system to increase its market penetration among savvy credit consumers, and it's an outstanding ploy. 

 


AMEX and it's member since policy has been around longer than FICO scoring. I'm not so sure it is a deliberate ploy. I think E-Oscar has an entry field for the date the tradeline was opened and to Amex that is the member since date so that is what is reported.

The credit bureaus job is to store the info provided by the data furnisher.

I started to say that they don't care if it is accurate or not but then I think about what happened to folks Crown Jewelers accounts lately and I'm not sure. That may be the bureaus resisting a ploy or it may be a Crown Jewelers payment problem. Regardless, there are millions of Amex card holders, I don't think the credit bureaus are going to challenge what is reported.

Message Edited by hobojon on 07-16-2009 03:44 AM
Valued Contributor
Uborrow-Upay
Posts: 2,710
Registered: ‎10-16-2008

Re: Credit Card Usage for high FICO score


hobojon wrote: 

I don't think the credit bureaus are going to challenge what is reported.


You're right, but I think it's the lenders themselves who can make the distinction between legitimate AU's and mere "pggybacked" AU's.  The lenders see usage and by whom.

 

I don't know enough about how lenders code reported credit accounts to address how the distinction could be made to the bureaus for scoring purposes, if in fact any of this is even accurate.  Again, opinion only here.

Frequent Contributor
hobojon
Posts: 261
Registered: ‎01-20-2009

Re: Credit Card Usage for high FICO score


Uborrow-Upay wrote:

hobojon wrote: 

I don't think the credit bureaus are going to challenge what is reported.


You're right, but I think it's the lenders themselves who can make the distinction between legitimate AU's and mere "pggybacked" AU's.  The lenders see usage and by whom.

 

I don't know enough about how lenders code reported credit accounts to address how the distinction could be made to the bureaus for scoring purposes, if in fact any of this is even accurate.  Again, opinion only here.


 

My spouses AU amex accounts are not noted as such on her credit reports. They look like they are hers.

Not sure how lenders are going to distinguish the usage of the primary card holder from the AU. I guess if you applied jointly for something that they may end up with both reports in front of them. More likely they would just end up with two credit scores in front of them and a very condensed summary of the reports.

I can't think of any credit app that, to my knowledge, was manually reviewed. It seems like it was all automated to me.  I really don't think the majority of lenders look past the score. Even when I refinanced my mortgage all they cared about was the numbers. If you had a mid score above 740 you got the best rate. They could care less how you accomplished that.

Frequent Contributor
hobojon
Posts: 261
Registered: ‎01-20-2009

Re: Credit Card Usage for high FICO score


haulingthescoreup wrote:

creditwherecreditisdue wrote:

This advice runs contrary to all accumulated FICO wisdom and experience other that yours.



(This was in reply to a post that the member's scores do better with util <1%.)

But I have found this to be true for my scores as well. My scores are optimum with less than 1% util reporting. Of course, the figure is rounded up on the score reports to 1%, but if I suddenly had 5% report, there would be a drop. I've seen this with all three reports.

Same here. I can't afford to spend enough money each month to get more than 1% to report. If I thought I needed a larger % to report for a better score I'd have to request that my CL's be lowered or start closing cards.

Senior Contributor
creditwherecreditisdue
Posts: 4,923
Registered: ‎04-19-2009

Re: Credit Card Usage for high FICO score

[ Edited ]

hobojon wrote:

Uborrow-Upay wrote:

The AU aspect of it may already have lost its effectiveness if it's not an actual AU account IN USE by the AU.

 

What I'm trying to say is that I believe the bogus (no-card-in-the-hands-of) AU accounts are being disregarded to some extent (if not totally) right now.   The "pay for piggybacking" on someone else's credit history did not go unnoticed by the CRBs or the lenders, and measures were taken to remove these artificial histories from being factored into individual scores, IMO.

 

Feel free to chime in if anyone else here has real evidence of this, because I'm basing my opinion solely on input from a handful of folks I know with AU accounts but no accompanying cards or actual usage on the accounts by the AU.


I hope that when FICO 08 is adopted and used, if they ever do, that this version somehow eliminates the benefits gained by purchased tradelines. I think it is scummy. As far as legitimate AU's, spouses and other household members. I don't think that will ever happen. I believe it is prohibited by the ECOA.

 I have never used any of my recently acquired 20 y/o Amex cards nor have my designated AU's and we both certainly have received the benefits of the cards credit limits and age.


It doesn't differentiate. It eliminates AU's, period. No more piggybacking on someone else's credit. There is really nothing unfair about that.

 

Could you explain exactly which section of the ECOA located here:

http://www.usdoj.gov/crt/housing/documents/ecoafulltext_5-1-06.php

applies to this matter?

Message Edited by creditwherecreditisdue on 07-16-2009 07:23 AM

myFICO is the consumer division of FICO. Since its introduction 20 years ago, the FICO® Score has become a global standard for measuring credit risk in the banking, mortgage, credit card, auto and retail industries. 90 of the top 100 largest U.S. financial institutions use the FICO Score to make consumer credit decisions.

>> About myFICO
FICO Score - The Score that matters
Click to Verify - This site chose VeriSign SSL for secure e-commerce and confidential communications.
Fair Isaac Corporation is a BBB Accredited Financial Service in San Rafael, CA
FOLLOW US Social Media Facebook Twitter Pinterest Google+