Large score drop after mortgage

[Anonymous]

I started out with scores at 694, 705 and 720, and I was trying to figure out what happened that could drastically make my FICO scores plummet by more than 200 points -- then it dawned on me that even though I just bought a house, I also just took on an enormous amount of debt (the mortgage).  Does anyone know if this is what can make your scores take a steep nose dive?

[MarineVietVet]

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@Anonymous wrote:

I started out with scores at 694, 705 and 720, and I was trying to figure out what happened that could drastically make my FICO scores plummet by more than 200 points -- then it dawned on me that even though I just bought a house, I also just took on an enormous amount of debt (the mortgage).  Does anyone know if this is what can make your scores take a steep nose dive?

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Hello and welcome. I'm going to move this to Understanding FICO Scoring. It will be seen by more people there and it's more likely to receive advice and suggestions. I also changed the title to reflect your specific concerns. If you want to change the title to something else, go to the post. To the right you'll see "Options." Click on "Options" and select "Edit Message" from the drop-down menu. If you need any help with anything, let me know.

--marinevietvet, myFICO moderator

[marty56]

Are the scores you posted FICO scores?  a 200 FICO point drop for a new mortgage is not going to happen.  If you puchased your TU and EQ FICO scores here, what is it saying that is hurting your score.  Also is the content of your CR correct?

[haulingthescoreup]

+1

No way that mortgage debt would do this. It's not included with revolving debt.

Did you keep a copy of your scores from your mortgage lender? Those should be FICO scores. If you started with those, and then pulled scores from a monitoring service like Experian or TrueCredit, you're comparing FICO's to FAKO's.

[Lel]

Some people experience a small drop in score shortly after their mortgage hits their credit reports, but after a couple of on-time payments, the points quickly come back - and may even rise above the pre-mortgage level.  200 points is unheard of.  As has been recommended, take a look at your credit reports in detail to see if anything else has changed.  Mortgage applications have a way of resurrecting old collection accounts.  These usually hit before closing, but it's not inconceivable that they might appear after closing.

[Anonymous]

Thanks for the reply marty56!

Yes, I pulled my scores from this fico website--I always do-- and I compared them to the ones my lender gave me when I first started the home buying process.  It's saying the balance of my accounts is too high in relation to the credit limits...I know for a fact that this is now showing since 3 of my creditors closed my accounts for inactivity!  I paid off the balance and was planning to keep them open, but wasn't using them while I paid off other accounts, and they just closed them, 2 of them without even so much as a letter in the mail!  I know this must've hurt my score tremendously

I started the ball rolling to purchase my home in Dec. 2009 and didn't actually go to settlement until March 2010.  DUring that 3-4 month time span, I checked my credit several times and was surprised to see that my lender had pulled my credit report 7 times!  I'm not sure, but I think that could have also lowered my scores a bit.  I know about the rule when you're shopping around for a mortgage -- you can apply to as many lenders as you see fit within a 30 day window and it only counts as 1 inquiry on your credit -- but seven times seems a bit redundant!

[GregB]

Inquiries from a home purchase in early 2010 would now be more than a year old and don't count toward FICO Score.

I have to believe that several things must have combined here to have a drop from around 700 to around 500. You must have lost some age and/or average age. You must have high utilization on your Revolving Credit.

Still hard to believe even at that. Do you also have a HELOC that is being added to Revolving Credit? Any new negatives of any kind?

[haulingthescoreup]

November 2010 thread...