Credit Cards

[Amoray42]

I am new to the forum and am trying to figure out why my credit score jumps around so much.  It will  change by as much as 15 points in a single day without any seemingly good reason.  For example, due to increases in 3 credit card balances (well within available limits) which are normal purchases (for gasoline and routine monthly expenses which will be paid in full when due as always), my credit score dropped 13 points!  Why is this happening?  I dropped below 800 which concerns me.

[myficomatt]

How are you finding out this info? (Man I can't wait until I can be worried about dropping below 800)

[krash]

Amo, don't worry about that! U are still way above most americans! They can go up and down, if u are looking at your FAKO's and not TRUE FICO's that happens! Don't worry about this, it isn't a problem! Do u plan on applyin for a home or a car? If not dont' worry, and for that fact if u are well over 750 u will get the best rates anyway! Good luck and don't worry, you will worry yourself to death lol..

[cheddar]

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Amoray42 wrote:

I am new to the forum and am trying to figure out why my credit score jumps around so much.  It will  change by as much as 15 points in a single day without any seemingly good reason.  For example, due to increases in 3 credit card balances (well within available limits) which are normal purchases (for gasoline and routine monthly expenses which will be paid in full when due as always), my credit score dropped 13 points!  Why is this happening?  I dropped below 800 which concerns me.

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Welcome to the FICO Forums, Amoray42!

One of the largest pieces of the pie that makes up your FICO score is determined by the ratio of your current balances (as reported to the CRAs) to your overall credit limits on revolving accounts (like credit cards).  The more of your credit that you use, regardless of the reason and regardless of whether you pay it in full, the higher risk the scoring algortithm deems you.

Most CCs report their balances to the CRAs on a monthly basis, usually on the statement date.  You can use your cards and still control the balances that report to the CRAs by paying your balance down (or paying it off completely) before the statement cuts, so that the statement balance is either $0 or a very small amount.  By doing so, however, you unfortunately are relinquishing your grace period on new purchases.

Having said all of that, there is no reason to fret going below an 800 FICO.  That is a very enviable score, and will still qualify you for the best rates on any type of credit you may want.  Anything over 760 or so is just for bragging rights.

Edited to add link to "What's In Your FICO Score" page from myFICO Credit Education tab:

http://www.myfico.com/CreditEducation/WhatsInYourScore.aspx

Message Edited by cheddar on 05-27-2008 12:20 PM

[ficonovice]

Very typical experience. This month I'm carrying some balances that were previously 0. My overall util has spiked from 5% to 16% and I've seen a drop of between 6-13 points for each balance. EQ has dropped 22 points. YES, utilization is a major point factor. 10 months ago, I thought getting my balances under 90% would be great and show that I'm responsible!!

It's true---get those balances down under 9% (but over 0%) and you'll maximize your FICO score. 

Message Edited by ficonovice on 05-27-2008 02:17 PM

[MidnightVoice]

I went from util <5% to 9% and lost about 13 points on EQ.  Normal stuff for me.

It will all come back - I am getting the hang of Amex reporting 

[Amoray42]

Thanks! I feel better already. This utilization stuff is pretty finicky.  I've always tried to spread charges around so that each card I have (which is admittedly too many) gets a little each month, but all is paid before it is due. I have a lot to learn (like picking a smaller font for my posts).

[Amoray42]

Signed up for Score Watch and set limits that email me with any significant changes (like dropping below a certain score or having your score go up or down by more than a set amount).  I think it is worth the money.  Helped me find a CC that an ex-wife was supposed to destroy, but guess what...she didn't and decided to use it 10 years later.  Took me less than a day to figure it out.

[myficomatt]

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Amoray42 wrote:

I have a lot to learn (like picking a smaller font for my posts).

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lol... Welcome to the forum. There are some very knowledgeable people around here.

[MidnightVoice]

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Amoray42 wrote:

 I have a lot to learn (like picking a smaller font for my posts).

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That is one you picked up waaaaaaaaaaay quicker than many people