My score went down -42 points

[Anonymous]

Hello,

I just had an alert from score watch that my score went down -42 point, the other week it went down -15 points as well. The explanation is that my usage is probably the cause. My credit score is now down to 666, from 720 in the last two weeks alone.  I am too scared to look at my other two credits reports. Only debt I have is 24oo on a loan and 246 on my Visa and 30 dollars on my Amex Blue.  Last month I used Amex blue-$90 and pif before statement cut, Macy's $136, Express $50.  All three were paid before I even received the bills, I had not used any of the cards in the last few months.

It could not be my utilization since all together with 24,000 of available credit, I am sure I am under 3%, what could have triggered a severe drop in my score?

[Anonymous]

Don't you get a free report each time there is a change that effects your credit score?

You are going to have to look at that and compare it to the last one you had before your score started dropping.

It could be any number of things that caused the drop. While Utl changes are the usual suspect it could be anything. Compare the reports and look at the little details. Dates, balances, etc.

Not everything causes a score watch alert ... so if the alert was triggered by your credit score changing SW had to find some reason to justify it... that doesn't always mean that reason given is the true culprit.

[GFer]

Either something major happened (new collection or late) or maybe you were put in a new bucket, possibly?

[Anonymous]

If the explanation said that it was "high credit usage" then that would be it.  I noticed that when I kept my cards down to a $0 balance when they closed for a few months and then let them have a balance my score dropped a little.  If you have no other stuff on your credit report and it's just your credit lines that are doing any movement maybe high credit usage will affect you more than I, since I am in a lower tier than you are? 

Credit scoring is about your risk level to the company who may want to lend you cash, right?  If you have been low risk for some time and then suddenly you have some high risk activity, that may account for the high score drop.

Edit:  Can you tell us exactly what it says?  I know my Score Alert usually says something about an account changing but the Understanding Your Score section gives you a list of things that occurred that caused the significant drop. 

Example:

1.  High Credit Usage

2.  Recent Missed/Late Payment (x months ago)

3.  Derogatory Accounts/Information (x accounts / x months ago)

4.  Recent Collection (x accounts / x months ago)

Message Edited by shawtycat on 10-19-2008 12:32 PM

[Anonymous]

I've been dropping a lot lately, as well (35 points in 3 months, slow steady downward progress).  FICO blames it on my lack of "robust" credit usage; I've only been using one (out of two) cards for the past 12+ months.  I've been doing about  10 to 20% util. on the card, and completely ignoring the other.  This is due to a rewards situation where if I wait until I "earn" over $200, I get an extra $50, or $250 total...I am less than $9 away, so free money is the focus of the single-use credit card.

At any rate, I did a SW (for the first time in over a year) and they said they'd dinged me for "lack of usage on multiple revolving accounts". I'm sure the moderate util on the other didn't help, either. 

I have started using the other card again, dunno what the result will be...with FICO it could either go up or go down (go down because I haven't used the card in a long time, over 12 months)

Dan

[haulingthescoreup]

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gbreadman wrote:

I've been dropping a lot lately, as well (35 points in 3 months, slow steady downward progress).  FICO blames it on my lack of "robust" credit usage; I've only been using one (out of two) cards for the past 12+ months.  I've been doing about  10 to 20% util. on the card, and completely ignoring the other.  This is due to a rewards situation where if I wait until I "earn" over $200, I get an extra $50, or $250 total...I am less than $9 away, so free money is the focus of the single-use credit card.

At any rate, I did a SW (for the first time in over a year) and they said they'd dinged me for "lack of usage on multiple revolving accounts". I'm sure the moderate util on the other didn't help, either. 

I have started using the other card again, dunno what the result will be...with FICO it could either go up or go down (go down because I haven't used the card in a long time, over 12 months)

Dan

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I was going to suggest using card #2 to buy a Slurpee, when I saw that you already have. You shouldn't have to let it report a balance. For this first month, use it, but pay it off before your statement drops, and see if that does the trick.

Although we don't see it on our reports, CCC's do report whether or not a card has been used in the previous billing cycle, even if there's a $0 balance on the statement. With luck, that's all you'll need. If that's not enough, though, you might have to grit your teeth and let it report once. DH has scores in the low 800's, and TU (of course) specifically dinged him for not having a balance report within 6 months, not just use it. I'm still not convinced that that wasn't just badly worded, though.

If nothing else, you should buy that Slurpee again once every 3-4 months (every 2 months for an HSBC bank card) to keep the second card from being closed for inactivity.

[Anonymous]

That's something I hadn't thought of....paying the balance before it's cycled.  I always wait until it cycles and pay it off a day or two later, but then I get dinged if the balance went up (regardless of paying it in full each month).

Thanks very much,

Dan