Recent drop in credit score

[Anonymous]

Hi everyone - I'm new here & hoping for some advice ...I am anxious to get my credit score up - a year ago my score was 821 - today it's 665.  I want to buy a house probably sometime within the next year so need my score bumped back up.  There are no late payments or anything here - the mistakes I have made were opening too many credit card accounts in too short a time. ( 4 I think in the past 6 months perhaps) and running too high a debt to credit ratio - about 30% in all- with 2 cards almost maxed out ...and some with no balance at all.  I also had a creditor recently close a card for inactivity.

I also bought a vehicle last August but I doubt that did not lower score ...it dropped rapidly in the past 6 months ...I understand the mistakes I made. I need to stop opening accounts and I need to lower my high balances. I am in a hurry to do this ...I can probably make a good dent in my balances over the next 6 months but wonder if things would improve faster if I took a personal loan to pay the cards down/off (and not run them up again of course) ...or would this further damage my credit?  My thinking is; my debt to credit ratio would be rapidly improved ...but I realize this is 'moving balances around' which I hear is not advisable

.. also how long will the opening of these new account continue to adversely effect my score?

[tntexans72]

Once you get your util % down to under 10%, you will see some score improvement. Obviously opening too many accounts lower your AAoA.

My score was in the 740+ across the board and I opened 3 new accounts, it dropped to the low 700s. It has been 1yr since my last credit app and my score still sits in the low 700s. I would imagine you would have to wait til most of the inquiries falls off (2yrs) and your AAoA increases before you start seeing drastic improvements.

[JusdoNit]

It is my understanding that a personal loan is considered unsecured debt.  The interest rate will be high.

Also, you will see your scores improve as you pay down those cards and/or get non credit pulling increases over the next few months.

Hope this helps, but if not toss

[tntexans72]

What is your AAoA at the current moment? How old is your oldest CC?

To Add: Another quick solution, other than getting your util % below 10% to see score improvement, I would find a close/long distance relative/family related that has an old TL open and in great standing to add you as an AU.

Example, if your oldest CC is 10yrs old, you add another TL that is 20+yrs old that is in great standing and low, low util % reporting month/month, that would increase your AAoA therefore boosting your score.

Util % and AAoA will account almost 70% of your Fico scoring combined.

[Anonymous]

Thanks folks ...I don't even know what an AAoA score is  ...my score of 665 is from TransUnion - I get notified when my score changes as a perk on one of my cards.  My oldest CC is probably 4 years ...the one that was just closed by the creditor was probably around that age ...wish I didn't let that happen but I had the card tucked away & didn't use it anymore

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@tntexans72 wrote:

What is your AAoA at the current moment? How old is your oldest CC?

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[Wolf3]

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@Anonymous wrote:

Hi everyone - I'm new here & hoping for some advice ...I am anxious to get my credit score up - a year ago my score was 821 - today it's 665.  I want to buy a house probably sometime within the next year so need my score bumped back up.  There are no late payments or anything here - the mistakes I have made were opening too many credit card accounts in too short a time. ( 4 I think in the past 6 months perhaps) and running too high a debt to credit ratio - about 30% in all- with 2 cards almost maxed out ...and some with no balance at all.  I also had a creditor recently close a card for inactivity.

I also bought a vehicle last August but I doubt that did not lower score ...it dropped rapidly in the past 6 months ...I understand the mistakes I made. I need to stop opening accounts and I need to lower my high balances. I am in a hurry to do this ...I can probably make a good dent in my balances over the next 6 months but wonder if things would improve faster if I took a personal loan to pay the cards down/off (and not run them up again of course) ...or would this further damage my credit?  My thinking is; my debt to credit ratio would be rapidly improved ...but I realize this is 'moving balances around' which I hear is not advisable

.. also how long will the opening of these new account continue to adversely effect my score?

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There is no need to improve your score until mortgage application time.   You need to pay your CC balances off by then.   If taking a loan saves you money then it is worth it, otherwise not.

AAoA is average age of accounts, you need to understand and look at that

There are lots of credit scores, you may not be looking at FICO score which is the defacto standard.

[Anonymous]

Okay ...I have the basic idea of the AAoA score ...I would say mine is around 2yr.  - not too impressive I guess.  7yr being the magic number?  What number is considered 'good enough'?  I guess it takes time & patience & no new cards to bring this up.  So I'll gain 1 year per year if I open no new accounts

I believe Trans Union is one of the major reporting agencies so I would think they would be FICO ...right?

Thanks for the help far!