02-09-2011 01:42 PM
I put a roof on this 100+ year old home of mine last year. My contractor was offering 0% interest through Wells Fargo as a line of credit with a Wells Fargo Home Projects Visa attached to it.
Of the whole total ($7,700), $1,500 is "on" the Home Projects Visa.
How should this be reporting on my credit reports? Is it a "revolving" account? I'm just not sure how "lines of credit" impact credit reports, or how they're interpreted from a FICO scoring standpoint. I'd love your insight.
It looks to me as though the payments I've been making for the past six months are lowering the 'balance' on the attached $1,500 Visa card, which I think was showing a balance of $200 on the last statement. Which is about right: Six payments of $213 would lower it by $1,284.
02-09-2011 02:17 PM
I went into my credit reports and checked. This line of credit for the roof is showing up on all three reports as a credit card! That doesn't seem correct to me, as the 'card' portion of this account itself has a $1,500 limit.
02-15-2011 02:41 PM
I can't speak as to how it should report, but if this is a line of credit, then it is scored just like a credit card. So, if it is considered a revolving, LOC or HELOC, the impact is the same in your example.
I noticed you posted a screenshot of TrueCredit. They sometimes misreport, though that may or may not be the case here. To be sure, pull your reports directly from the CRAs. Also, if you want to know how FICO looks at it, pull your FICO reports. FICO may exclude this TL from utilization if it doesn't have a CL reporting. You may want to double check to be sure. But again, LOCs, HELOCs, and CCs are all lumped and scored together per utilization.
02-15-2011 02:56 PM
That's so frustrating. I appreciate your response.
I was so happy that I was able to get 0%, and I had put it dead last on my payback plan, but I guess I'd better start paying it down.
When it's paid off and I close it, it will stop dinging my score, right?
02-15-2011 03:16 PM
If it is scored like a revolving, then paying it off would help your util and could help your FICO score.
Another possibility to consider is that it might be scored as a consumer finance loan (CFL). If that's the case, then it might not be factored into util at all. The "WFF" in the TL name is Wells Fargo Financial and they are a separate division from Wells Fargo. They are known to offer consumer loans (much like CitiFinancial, Beneficial Financial, etc.). If that's the case, then it won't be impacting util, but you could get the ding for the CFL reporting (though relatively minor, esp. against a higher util CC). Again, your FICO report would make that distinction.
02-26-2011 02:20 PM
Maybe I'm getting a double bad hit on this account: