Score Finally Good Then Suddenly Drops 30 Points

[Anonymous]

So I've been really happy to see my score climbing back up and it finally reached the "Good" ranking last month after using our tax refund to pay down credit card debt and pay off a couple other accounts. Just a couple of weeks ago my score was as high as it's ever been at a 683. Because we still owed about $5000 on our credit card, I decided to transfer that balance to a new card with a good balance transer deal (0% APR for 15 months). I've never had good credit so I was excited, thinking that it would keep going up from there. Well, my monthly 3-bureau report just came out and my score dropped 30 points over the past couple of weeks and is now back to "Fair". I'm devastated because it seemed like I was doing all the right things. I did notice that on the report, it doesn't show that the credit card balance was transferred- instead it now shows that balance plus an additional balance on the new card. Could that be why my score dropped so much? That's the only thing that's changed recently- everything else is still current and in good standing.

[ddemari]

Sorry that happened. Do you only have 1-2 cards on your report? It sounds like you did the balance transfer with Lender A and the balance is gone from their bank but they have not updated your statement yet. Therefore the credit agencies have not reported that the old card has a 0 balance. So now you have card A and card B reporting with balances that likely tipped your utilization over and you have two cards reporting with a balance. I think that once your reports get updated and the old card has a 0 balance, you will regain the points. 

[Officer737]

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@ddemari wrote:

Sorry that happened. Do you only have 1-2 cards on your report? It sounds like you did the balance transfer with Lender A and the balance is gone from their bank but they have not updated your statement yet. Therefore the credit agencies have not reported that the old card has a 0 balance. So now you have card A and card B reporting with balances that likely tipped your utilization over and you have two cards reporting with a balance. I think that once your reports get updated and the old card has a 0 balance, you will regain the points. 

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^^^^^^^This is my thinking as well

[Anonymous]

Thank you both for responding. I do only have the two credit cards and a couple of retail cards with no recent activity/balances. I was just shocked to see my score jump down so much but like you said, hopefully once the other account is updated to reflect the zero balance, my score will go back up. Otherwise, I'll say I did enjoy those two or three weeks of having "Good" credit while it lasted. Ha.