01-05-2013 08:49 PM
I just recieved a FICO score watch, It said my score dropped from 792 to 736! What could cause such a drop? I have been paying down my credit cards and they are now under 10% utiltilzation on my 35K of credit! It was around 20% because I bought a car on my credit card last year! I used my credit cards on a regular basis during the holidays but I usually paid them within days of using them. My score watch said my score dropped because of use high use of credit cards. (NONE had a balance of more than $200) It doesn't make since to me because I have had my score watch for 4+ years and have never experienced a drop anywhere close to this! Even after I bought my house it didn't drop that much! Any ideas about what is going on? I normally use my credit cards the same way every holidays and when I go on vacation. I use them and then pay them off to get the points.
Here is what I recieved! HELP!!! Do I need to pay and see what is in this latest score watch or should I give it a couple of weeks?
|This score decrease may be caused by these 2 new reasons:|
01-05-2013 09:17 PM
I'd pull EQ from somewhere. Specifically check for any dropped accounts from the first of this month. The alert you received was a score alert and it's only guessing as to the change. The cause of the drop wouldn't have triggered a credit alert so that narrows out several items. It could be a dropped account resulting in a change of your length of history and/or AAoA. It could also be a CLD resulting in higher util. It could also be a baddie updating when it hadn't in a long time (assuming you have any, though likely not with your score). You can rule out several items like balance increases, added accounts, added baddies, and others.
01-05-2013 10:08 PM
I went back and looked at all my credit cards today to just make sure someone didn't steal a card number. All accounts, were accounted for and the amounts correct. I don't have any negatives and haven't since about 2003 or 2004! The only closed account I have is from a JCP card opened in 1996 and not used since 1999. I guess I also had a car loan that I paid off in 2005. I agree with you about being able to rule out certain things because it didn't trigger a credit alert. I'm trying to figure it out using my second credit score for the year. I use mine about every 6 months my last one I did was in the End of Oct so I would like to wait until later in spring or early summer because I am planning on buying a new house.
01-06-2013 05:36 AM
I would pull EQ from somewhere; it doesn't have to be from here. Use annualcreditreport.com or a CMS from somewhere. JCP should have dropped by now. If it did drop Jan. 1 (most of my TLs dropped on the first of any given month) and was your oldest then that could have produced a significant ding.
01-06-2013 02:44 PM
you said that you have many balances across several cards? how many cards are we talking here?
i have had under 7% util on 2 cards for close to 3+ months with a high of 697 score.
now that my util is 20% reported across 6 cards (out of 10)
3 of them appear to be maxxed (at the time of alert were 80%+ becuase they were low limits)
my score dropped in total from 690 to 677 and then eventually too 635.
and its only because of utilization.
i did add one account though. no inquiry.
my aaoa only changed about half a month.
+1 to the other poster about checking your report.
you said you had a closed account in 99'? that would have fallen off your report in 09'.
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01-06-2013 09:06 PM - edited 01-06-2013 09:18 PM
Ok First of all I have 15+ accounts and when it said I had to many accounts with balances it went from 4 to 7 though none of them with more than $200 new balance. My credit Utilization is still under 10%.
I couldn't handle it anymore the not know was killing me, so I went ahead and used my free score report. When I opened it here are some of the things it said in the "Understanding your score"
On the Positive side....
1. No missed payments
2. Long Credit history (longest 16 1/2 years and average 7)
3. Low Credit Utilization
On The Negative side....
1. Too many credit cards with balance.
2. Installment balance on non-mortgage is too high.
The only one I have never seen before on my credit report was the last one. Installment balance on non-mortgage is too high. Here's what I don't understand I have had my student loan since the beginning of 2011 and started paying on it in October at the end of the deferment period. (This has to be the one that is triggering the HUGE drop!) I can't believe it though. Why now? Why after I've made 4 payments? My student loan has been showing up on my report since I got the loan 2 years ago! I was expecting a drop but not 50+ points! I can't believe my student loan set me back to the same level as back when I had multiple missed payments and higher credit usage and several new accounts! This has set me back to where I was almost 2 years ago! I sure hope after I've made 6-12 months of payments that it will start to pop up because we are planning on moving this summer.
This is the first time I have used multiple credit cards after starting my payments of my student loan so maybe that triggered this????
If anyone has any other ideas I'm open to hearing them.
As for the closed account it still showed up on my report. I never offcially closed the account. It just states the account was closed due to inactivity. I had that happend to another store card several years ago too. I got a letter and stated because of my lack of utilization they were closing my account if I didn't use it. ( I thought it was odd but didn't care as I only used the account once to get the discount on a large purchase.) Both still show up on my credit history as closed/paid zero balance.
01-07-2013 06:46 AM
Most of the effect is from "too many accounts with balances". When you have several accounts with balances, there is a point where you take a score hit for too many of them not reporting zero. Sounds like you just found that point. With 24 accounts on mine, I find it is just around half, or 12.
Pay a couple down to zero and see what happens. Let one balance go up after that to trigger a SW alert and recalculate your score since the other changes won't trigger an alert. Just one example of SW being crummy at monitoring changes.
Your information may have changed where the student loan started to have a significant effect. As the information changes your information is run through different Scorecards and it may have had a smaller effect before.
01-07-2013 10:27 PM - edited 01-07-2013 10:50 PM
One thing to check might be that during the deferment period your loans may now be showing a higher balance than the loan was originally taken out for. This may indicate that a loan is going backwards which is a red flag potentially. Loans should only decrease over time. School loans or deferred loans in general may be treated different but this is just a guess of mine. This is the only explanation I can come up with for "Installment balance on non-mortgage is too high."
01-08-2013 02:26 PM
I had something similiar happen to me.
I always only post one card with a balance on my account.
I mistakenly let 1.50 post on a second card, and took a 15 point hit.
Your score is very high. Little changes make big impacts.
01-08-2013 03:39 PM
Thank you everyone for your input. I normally don't have multiple cards post with balances it is just the case that some christmas presents were on the card and of course they posted the day that I was suppose to have the payment made. I have since paid all it back down to just the 2 accounts. I will keep everyone updated as to whether or not that changes my score much.