@Anonymous wrote:
So for well over 3 years (since I've been out of the hospital and gotten my accounts back where I can deal with them) I've paid ALL my bills in the FULL amount due or more each month ON TIME OR EARLY each month but my scores didn't change at all.
That's good but, first of all, not all bills are credit. You need to give us a better idea of your credit profile for us to provide feedback specific to your situation. Bills aren't necessarily relevant for our understanding. Your credit accounts, however, are important.
Paying credit accounts in full and on time is good also but you can't just expect constant increases at a fixed rate for doing so. Payment History is the biggest factor but payment history isn't just recent payment history. Your entire payment history matters. Your Payment History needs to be at 100%. Not 90%. Not even 99% but 100%. if you're not there then you'll need to work to get there and it will take time. Building and rebuilding are long, slow processes so make sure your expectations are reasonable. You're not going to fix everything immediately or even in a year or two.
In addition to Payment History all of the standard factors matter.
http://www.myfico.com/crediteducation/whatsinyourscore.aspx
If you're looking to improve scores then you need to carefully review your reports with the factors in mind, identify the deficiencies and work on addressing them, starting with the biggest factors first.
@Anonymous wrote:
Ok so I've been working to pay off my debts and settle any accounts that are not in good standing. I just paid off a closed charge off account which I found awhile back.
Paying won't help as much as removal. You generally have more leverage before paying but you can still request a goodwill removal. Take a look in the Rebuilding subforum. Just keep in mind that they're no obligation to comply with a goodwill request. It is dependent on their goodwill.
If you have any other derogs then you also need to carefully research and look into addressing them as well. Derogs can tend to have a significant impact and hold one down as long as they are on reports which is why we always recommend addressing them first.
@Anonymous wrote:
Today I just ordered a new report and its showed my Experian score has dropped by 3 points. I don't understand this as ALL my bills have been paid in the FULL amount or more each time they are due or some are paid up as much as 3 months ahead of time, I've applied for NO new credit, my balances are decreasing making my debt to income ratio less.
What score are you looking at? What model?
If you're going to refer to scores then you need to set a larger threshold. Scores fluctuate a bit just with normal activity and 3 points is negligible. Slight changes due to reported balances/utilization changing from month to month can easily cause point changes of that scale or more. Worry over changes of 20 points or more.
If you want to determine the cause(s) for a scoring change you have to carefully review reports from before and after the change and ensure that you're accounting for everything. A point change in and of itself doesn't really tell you anything. There could have been one change that lead to a drop of 3 points. There could have also been a number of changes postive and negative with a net effect of a drop of 3 point. However, even without knowing the details you can tell that what you're worrying over isn't having the impact that you think it should. IMO that would indicate that you need to look at other things and do some more reading up.
Paying ahead doesn't really matter for scoring. You're either on time or you're not. The amount isn't quite as important either. You do want to pay every credit card statement balance in full to avoid incurring interest but that really doesn't matter for scoring. Scoring looks at reported utilization (balance[s]/limit[s] as indicated on your reports) for your revolving accounts. Revolving utilization falls under Amounts Owed in the link I provided above. Other factors with regard to debt amount factor in as well but revolving utilization has a significant impact. The general advice with revolving utilization is do not exceed 30%. If you have revolving accounts and/or if your overall revolving utilization is over 30% then get it down. 30% is far from ideal. It is a max. Generally lower is better with optimal falling under 10%.
@Anonymous wrote:
In addition *** this is wildly interesting**** my FICO had a section where it allowed me to simulate my scores
It's really not interesting if you realize that it doesn't really mean anything. Don't rely on simulators. Learn about the standard factors. Learn to assess your own reports.
@Anonymous wrote:
This has caused me to have to wonder how correct my FICO is and how the national credit scoring system actually operates.
It's cetainly debatable but not because of the simulator. IMO it's not useful to worry over how "correct" it is. It is consistent. We are all subject to the same system and it is definitely possible to improve even if you just have a rough idea of how things work.
@Anonymous wrote:
So, can anyone explain any of this to me at all?
General advice like what I've posted above are all we can provide unless you can help us to get a better understanding of your credit profile. You don't have to disclose specifics but look at your reports in terms of the factors in the link above and other comments provided. How is your entire Payment History? Are there any lates? Any derogs? How is your reported utilization (refer to the balances and limits as indicated on your reports) for each revolving account? How is your overall revovling utilization? What's your Average Age of Accounts? How much new credit have you applied for recently? How many hard pulls are on your reports and what are the ages of your hard pulls? What's your mix of credit like? How many accounts do you have of each type? Payment History is the biggest factor but it's not the only one.
Definitely read up as well. Hit the link above. Follow all of its links and read futher. These forums are also a very useful resource.
