General Credit Topics

[MM1234]

I know everyones experience/scores/history differ so this may or may not effect you. But its what happen to me.

Few months ago Debt Free - Zero Balance on all reports
About 2 months ago - noticed a 4 point drop in score for no reason
Found out maybe cause not using credit cards/dormant/nonreporting CRA
Fount out should carry balance of 1-6% ( NOT O% )
Went out and put 1% on all cards I have - No score changes.
This month - my Chase Reported a balance of $75
TU Stayed - EX Dropped 3 points - EQ Dropped 22 points!!!
I believe it was from the Chase Reporting
Read the SW Alert that any balance increase can lower score
Read the SW Alert that any Charge on a DORMANT CARD can lower score
Hadn't used any Cards for 4 months till now just to add/keep reporting
This week made a Desicion on what cards to keep/leave 1% balance
Kept all my Prime cards with Largest Balances
Paid OFF the other 2 that I dont plan to use
Will see if scores go back up on EQ.

I guess this is proof that you should keep a balance so your card never goes dormant or unused/unreported OR if you stop using a card for a long time, in my case 4 months, you should expect to see a score drop in some cases. I was surprised that only $75 on a $7500 CL would do that.

I've learned yet another thing so figured I'd mention my experience. But while I did like having no balances, I feel keeping that now only keeping 3 cards with a 1% will be fine and keep me in the mid 700's.

[MidnightVoice]

MM1234 wrote:

I guess this is proof that you should keep a balance so your card never goes dormant or unused/unreported OR if you stop using a card for a long time, in my case 4 months, you should expect to see a score drop in some cases.

I have a card (gas, $700 CL) which I can no loNger use locally as there are not any gas stations here any more.  But it is a very old card and I want to keep it active.  The CCC told me to use it more than once every 12 months and it will not go inactive.  But when I did use it - sure enough, a score drop ($22 balance).

It does not bother me unless for some reason I would have to do it at a time when I am seeking credit.

Message Edited by MidnightVoice on 09-24-2007 09:47 AM

[rifleman]

great post--thanks for the heads up. I have 3 cards that have been inactive for a few months. I have a card that I got 3 months ago that I have never used. Thinking of closing it--should be fine, won't effect utilization. I just don't want to have to bother to try and use it every so often

[orhippychic]

i think these score drops are only temporary because it will be the PAYMENTS on those balances that boost your score. I'd be interested to see how the scores change after a couple of payments. Keep us posted!

[MidnightVoice]

There is a difference between what you need to do to keep the CCC happy and what you need to do keep FICO happy.

I will use my card twice a year to keep the CCC happy and the card active.

Some CCCs will need to do a credit check to reactivate and inactive vard, and I don't want that

[MM1234]

MidnightVoice -

Thanks for sharing. Im glad that someone else can confirm this happened to them too. Sorry for your drop too of course. Its wild to see that much of a drop for a small amount. Yeah, ....even with no balances my scores would go up and down 4 points here and there. So they should recover it was just a surprise to see.

Others, I'll come back and update as it goes.