Buckets are interesting. The FICO formula is very complex and was created based on the input of lenders. Lenders like to compare your score with others who are in the same type of situation as you are. In other words, you are not directly compared to someone who has a 30+ year history with a flawless report. So, buckets (aka scorecards) were created to give a comparison to those who have a long history, those who have derog info, etc.
I like to use college as an anology. Remember the professor who would grade on a scale. If your grade is the highest in the class, let's say 80%, then on a scale, you basically got an "A". Buckets are the same. Based on your scorecard, you are compared to everyone else with a similar report. You have the ability to advance in score faster if those in the same situation don't fare as well as you do.
Regretfully, when your last derog is removed, you would be placed into a new bucket and compared to those w/ no derogs. That can have a temporary, negative impact on your score. Now that didn't happen to you (because you still have the CO and lates), but it did happen to me. My last baddie impacting my score was removed, a 7 y.o. 90 day late, and to my surprise, my EQ FICO score dropped 17 points. I knew that the 90 day was going to drop that day so I even pulled the EQ FICO the day prior to have an accurate comparison. Since my credit age was relatively so young in compared to everyone else with no baddies, I became low man on the totem pole w/ a lower score. My score has since recovered, but that was likely due to large drops in util.
