How Do I Maximize?

[Anonymous]

I paid off all of my credit accounts off including my car and house with a mortgage refi. I had an immediate boost with getting baddies off and paying the CCs. When the car reported it did not affect my score although now the house is reporting paid off and my has score taken a hit. While they are all still higher than what I started with in early September, my scores are not where I would like them to be. I have two COs and one med Collection falling off next year.

The new mortgage loan will not appear until probably January. I use several of my CCs but try and only let one report a low balance each month. What else can I do increase my score? I would like them all to be 720+ but I have been stuck to around close to the 700 mark but not steadily staying there (even at 718 with TU at one point). It took a hit with the mortgage reporting zero as well this month. I also want to do another refi early next year in order to get better terms. I know I should have probably waited but when I started the journey to refi, all I wanted is to pay off all my bills and did not know a thing about scoring. I shortly thereafter, found this site. My AAoA was about 7 years.

[Anonymous]

Given what you have described there is nothing more you can do.  To extract every available extra point, one typically has one card reporting a small balance and all others reporting zero.  But you are doing this.  You have done the appropriate work on your derogs and you know that the remaining ones will be falling off in the next year and when.  You have a large installment account about to appear on your report, and until that happens you can't do anything about the "open installment" part of your profile.  Presumably you understand that adding new accounts will not help you (and will actually dent your score a bit further) so you aren't adding more cards.

So there's really nothing to do except to let your profile stabilize (with the new mortgage appearing), allow your derogs to fall off, and allow  any inquiries to age over 1 year.

It sounds like your chief interest is in performing a double refinance of a large mortgage in under six months.  You have just recently refinanced it once.  You would like to refinance it again.  That's the driving desire on your part, it sounds like.  It may be worth pulling back and looking carefully to make sure that this is actually in your interest.  Refinancing a loan, based on what little I understand, costs money: a big fee typically.  The fee is offset by the fact that over time the lower interest will make up for it.  But it's hard to imagine that in three months the lower interest has counterbalanced the refinance fee. 

Of course, you may have looked into all this and are getting some kind of great deal where there are no fees to refinance -- they just do a lot of work on their end and give you a much lower interest rate.  Anyway, that's your thing to consider and can ultimately make that decision yourself.  But there is nothing I can see that you can do now with your credit except allow time to heal all.

[Anonymous]

Thanks CreditGuyInDixie. It will be a no cost refi and I got it in writing, thanks to this forum! I had almost canceled the refi because of the cost and rate, which I got them to lower although not as low as I could have with better scores.

I will also have some inqs falling off, with one being a year old this month. Although I think I've read they don't count in FICO scoring after a year. It has been weird with the scoring. Something I think will hurt doesn't and something I don't, usually does. After some stabilizing, points slowly increase?

I know my parents have almost perfect scores. They each currently have one or two credit cards and a mortgage loan and that is it for open accounts. I know the AAoA is quite substantial as they have had other auto loans and mortgage they have paid off years ago.

[Anonymous]

It sounds like your big desire is to get your scores up.  I sense that you have several open credit cards.  Is that right?  If so, how many?  If you have at least five, one thing you can do is make sure to not open any more CCs.  Once you get more than 3-4, you are getting no extra scoring benefit and each new card will lower your AAoA.  Naturally that doesn't mean that nobody should have more than four cards.  It's just that if the sole driver for a particular person is getting her scores to rise, then she should stop opening more once she has a solid number of them.  On the other hand, if you do have many cards, you won't get a scoring benefit from closing them eiither.

Even more does this apply to credit "deals" at Best Buy or Rooms To Go or whatever.  They actually harm your score, even if you are making perfect payments.

So: no new accounts period.  No new cards, payment plans, etc. 

In answer to your question about inquiries: you can be certain that inquiries lose all scoring impact (for FICO) after 12 months.

Overwhelmingly the biggest help to your score will be some major derogs falling off next year.  Watch those carefully and develop clear plans to prevent any derogs in the future.  Exactly when are your various derogs slated to fall off?

As far as your credit cards go, it sounds like you are using the rule of: All Cards at $0 Except One Showing a Small Balance.  That's fine.  But make sure you understand that you don't have to do that most of the time.  Just in the month before needing to see the maximum of what your score could be.  If I were you I would relax a bit, let your cards report naturally for a while (though be sure to pay in full), and then maybe in March when your mortgage has been on the report for a few months with payments recorded, then go back to the All Zero But One rule.  (Though if you will be having some derogs falling off in Feb-May you may want to wait till after that.)

Finally: the question about your profile stabilizing.  Here I just mean that you have had a bunch of stuff happening, including a huge account leaving and another about to appear.  You are not going to have any clear idea of what your score is like with the new mortgage until it appears on all three bureaus for a few months.  Right now you are in limbo and shouldn't be stressing out about your score untill you have more info to go on.  And yes, as time increases the age of all your accounts that will also be a help.

[Anonymous]

I have one CO with its CA coming off in Apr ( was supposed to be Jan and only left on EQ CR). Have one CO in Sept. and the med collection will probably stay until June (working on sooner).

I just realized I have FIVE NEW CCs and they can't be helping me at this point!!! One is a year old but the rest have been since early summer this year! I wasn't thinking about how they were affecting my scores. I also have 4 store cards that are more than three years old and 1 CU CC that I've had for 12 years. I have recently gotten CLI on all the store cards and I know that helped with UT.

There are several other revolving accounts (both store cards and regular cards) as well as some old installments (paid off) still reporting in good standing although I'm sure some of those will fall off in the near future as well.

I started gardening after the last card I got (September) and plan on combining that card with the year old account after I've had it six months (Cap1 QS).

[Anonymous]

You are doing a great job on your derogs.  They are the most important thing.  Keep those in mind and think through carefully how they happened and create a plan for reducing the chance that you will ever get another.  For example, implementing auto pay for every open account is an awesome way to eliminate the chance that you could ever accidentally get a late payment.

Your new credit cards are what they are.  You'll get no help from closing them, so just make sure you use them naturally, establish payment histories on them all, always pay in full, etc.  As a very long term goal you may want to consider closing a store card or two but only if it is clear you don't really use it.  The reason is that some industries -- like the makers of auto insurance, for example -- pull your credit reports and if they see a lot of store cards they may charge you more than if you had very few store cards or none.  Closing store cards should be a LOW priority concern, however, that will not help you with your FICO score itself.  (Remember it takes 10 years for closed accounts to drop off.)

You mention that your new CCs help you with your CC utilization.  Just remember that you can always control your utilization.  Even if you had a total credit limit of $500, you could make sure that it reported at 1%, 2% whatever you wanted by paying down your debt.  Overwhelmingly this is the right way to control your utilization -- expanding CLs is only helpful as a matter of convenience and is a warning sign if a person is doing it because he can't pay off his debt.  This doesn't sound like you though, which is great.  (Know also that FICO doesn't give you any extra points for having a big credit limit.)

Best of luck!

[jamie123]

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@Anonymous wrote:

I have one CO with its CA coming off in Apr ( was supposed to be Jan and only left on EQ CR). Have one CO in Sept. and the med collection will probably stay until June (working on sooner).

I just realized I have FIVE NEW CCs and they can't be helping me at this point!!! One is a year old but the rest have been since early summer this year! I wasn't thinking about how they were affecting my scores. I also have 4 store cards that are more than three years old and 1 CU CC that I've had for 12 years. I have recently gotten CLI on all the store cards and I know that helped with UT.

There are several other revolving accounts (both store cards and regular cards) as well as some old installments (paid off) still reporting in good standing although I'm sure some of those will fall off in the near future as well.

I started gardening after the last card I got (September) and plan on combining that card with the year old account after I've had it six months (Cap1 QS).

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You are on the right track. It is your derogatories that are holding your scores down. You can only raise your scores so much before you hit the ceiling if you have ANY baddies on your reports. My wife couldn't get her scores above 711 with 1 CO on her reports. When that CO fell off leaving her with clean reports her scores skyrocketed to 803.

Look at the scores in my siggy. My reports are the same except for a tax lien on that only shows up on EQ and TU. My EX is clean and is more than 100 points higher than EQ and TU.

Your baddies are hurting your scores more than you think.

[Anonymous]

Well I guess I will be just letting it all settle and stew but keep on trying to work the derogs. Thanks mucho CreditGuyInDixie!!!

@Jamie, I Have only one of those CO reporting on TU (no other derogs). It's the CO that won't come off until Sept next year. My score was up to 718, eve with this on it. My score has been dropping since I paid everything off. My hope that now everything at zero, things will settle and my new mortgage will probably start reporting in Jan. Then will see what happens to my scores....eek! I'm hopingit's not too bad and that my mortgage scores will go up. But I'm still trying to learn here.

I love this place...