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bionurse04
Posts: 2
Registered: ‎04-19-2011
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Question about credit utilizaiton

My wife and I, after a lot of hard work got our credit scores to where we can get an FHA loan through Wells Fargo. We paid down her 3 credit cards to 0 and her middle score has dropped 3 points.  How does that effect her beacon score? Her middle score was 601. Should we put something on one of her cards to make her utilization 1% for closing? I don't want to get to close and have them pull the credit reports again and get dropped below 600 which would, I assume, cause us to lose the loan and the house.

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MarineVietVet
Posts: 14,911
Registered: ‎07-14-2009
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Re: Question about credit utilization


bionurse04 wrote:

My wife and I, after a lot of hard work got our credit scores to where we can get an FHA loan through Wells Fargo. We paid down her 3 credit cards to 0 and her middle score has dropped 3 points.  How does that effect her beacon score? Her middle score was 601. Should we put something on one of her cards to make her utilization 1% for closing? I don't want to get to close and have them pull the credit reports again and get dropped below 600 which would, I assume, cause us to lose the loan and the house.



Welcome to myFICO.

 

It seems counter intuitive but paying all those cards down to zero probably did cost you a few points. FICO likes to see some use of revolving credit and you are dinged for all zero balances. It's hard to say how much this affects each of your three scores because each CRA has a slightly different scoring formula.

 

Having one of your cards report a small balance on it's next statement with the other two reporting zero balances should bring your score up a bit but exactly how much is difficult to say.

 

Why don't you let us know how this works out for you? And good luck!!

 

 

 

From a BK years ago to:
EX - 3/11 pulled by lender- 835, EQ - 2/11-816, TU - 2/11-782

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

 

 

New Member
bionurse04
Posts: 2
Registered: ‎04-19-2011
0

Re: Question about credit utilization

I will. It sucks that we are in a position where the 3 points would make a difference but we are and we have to do the best we can with it.  I am just happy we caught it in time, all the cards will report again before we close and that would probably get us the 3 points back since that is the only thing that has changed on the credit report since the score was higher.


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