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New Member
Posts: 2
Registered: ‎04-18-2015
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50+ point drop withing 2 weeks

I was one of those people who went thru their younger years not really paying attention to my credit score. Other than a couple of car loans over the years, If I didn’t have cash for something - I didn't buy it. The first week of January 2017 I pulled all 3 credit reports and made a list of everything that was being reported. The negative items being reported were from my student loans and medical bills from the birth of my daughters. Positive items were 3 credit cards all with High available credit and low open balances (under 19% usage) and 2 care loans.

 

I took this list and paid off every single open item (derogatory or not) being reported except for 2 credit cards. Within 2 weeks of getting everything paid off my fico score dropped over 50 points upon items being revised to show as paid. As of right now I have 2 open cc's with very low balances and 1 new car loan of $15,000.

 

I understand that things stay on your report for a time. But, one would think that going from collections to paid would increase your score and not cause it to drop. Does it take time for things to rebalance or did I do the wrong thing by paying off everything on my report? Are there any agencies that can look at my report and advise the best path forward to increase my scores?

 

I'm a complete noob and I find this credit thing to be very confusing, so I apologize for my ignorance. Any guidance would be greatly appreciated.

Senior Contributor
Posts: 5,391
Registered: ‎02-24-2015
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Re: 50+ point drop withing 2 weeks


rbailey303 wrote:

I was one of those people who went thru their younger years not really paying attention to my credit score. Other than a couple of car loans over the years, If I didn’t have cash for something - I didn't buy it. The first week of January 2017 I pulled all 3 credit reports and made a list of everything that was being reported. The negative items being reported were from my student loans and medical bills from the birth of my daughters. Positive items were 3 credit cards all with High available credit and low open balances (under 19% usage) and 2 care loans.

 

I took this list and paid off every single open item (derogatory or not) being reported except for 2 credit cards. Within 2 weeks of getting everything paid off my fico score dropped over 50 points upon items being revised to show as paid. As of right now I have 2 open cc's with very low balances and 1 new car loan of $15,000.

 

I understand that things stay on your report for a time. But, one would think that going from collections to paid would increase your score and not cause it to drop. Does it take time for things to rebalance or did I do the wrong thing by paying off everything on my report? Are there any agencies that can look at my report and advise the best path forward to increase my scores?

 

I'm a complete noob and I find this credit thing to be very confusing, so I apologize for my ignorance. Any guidance would be greatly appreciated.


I think it will rebalance. Negatives don't automatically get removed because they get paid. But they do age off.

 

What you can do for your scores right now is:

 

1. let one credit card report at zero balance and the other report at 9% or less of the credit limit, and

 

2. pay the car loan down as fast as possible.

 

Also you might want to start sending verification letters to the credit bureaus asking them to verify any negatives being reported, or hire someone to do that; that will often result in negatives being removed from the report.


FICO8 EQ 782 TU 803 EX 790 FICO5 EQ 747 Total revolving 463000
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New Member
Posts: 2
Registered: ‎04-18-2015
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Re: 50+ point drop withing 2 weeks

I appreciate the feedback. I've done steps 1 & 2. Now waiting to see how this affects my score.

 

Is there a sample verification letter that you would recommend?

Regular Contributor
Posts: 180
Registered: ‎03-21-2015
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Re: 50+ point drop withing 2 weeks

[ Edited ]

If it is any comfort, while I was not successful, in general with pay for delete, disputing got many items removed from my reports. Calling original creditor worked for others, including all medical. And some simply dropped before the 7 year mark. I had 29 collections a couple of years ago, mostly medical, and now I have none. Paying for collections doesn't make them go away immediately or improve your scores as far as I understand, but it may make them go away more quickly than if unpaid. Good luck!

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