@Anonymous wrote:Hi SouthJ. You might want to double check that advice with Revelate and Thomas Thumb. They are both certain that the EQ and TU mortgage scores do not benefit at all from paying loans down, though of course they agree that FICO 8 does benefit.
Before we urge the OP to do something costly (paying all of his existing installment loans to under 10%) it would be good to know that this advice will help him. He's already in recent memory taken action related to paying off installment debt that did not help him at all.
Well I'm not in their league, I'm just talking about my own experience. The only score I can monitor on a day to day basis is FICO 8, but once a month I pull the report with other models including the mortgage scores. And I've noticed that although my mortgage scores are always lower than my FICO 8, they generally move in the same direction.
But I could be wrong.
If you, Revelate, and Thomas Thumb say I'm wrong, then I'm wrong.
But here are some of my numbers comparing 3 monthly reports:
TU FICO 8 went up 27 points while TU mortgage model went up 7 points.
EX FICO 8 went up 26 points while EX mortgage model went up 9 points.
EQ FICO 8 went up 92 points while EQ mortgage model went up 44 points.
So yes, they're far from the same, but when my FICO 8 goes up the mortgage model usually goes up too, and when my FICO 8 goes down the mortgage model usually goes down too.
Like I say, this is from my own personal experience, not the type of detailed scientific observation Revelate and Thomas_Thumb do 
Nah it's not that you're wrong, just likely didn't spend the time reading the awfully ugly thread I started 1.5 years ago and then never went and prettied up where multiple people confirmed it. Also you had a busy file, there's just no rational explanation that installment utilization was the sole factor in your score increase looking at a 90 point jump on EQ.
FICO 8: installment utilization counted.
FICO 04: installment utilization not counted
FICO 98: installment utilization counted.
With all the installment balance tweaks I did (confirmed through both DCU and 1B/3B reports here) in the run up to my mortgage on an incredibly fixed file, I never got FICO 04 to move at all on any bureau: EQ, TU, EX; however they absolutely moved on all of the FICO 8 models, and it did on the one FICO 98 model we have reliable access to.
The overwhelming majority of the mortgage lending space (like 99.999% in the United States) are on EQ 04, TU 04, EX 98 (MF calls them FICO 5, FICO 4, and FICO 2 respectively) and the only one that shifts on that front is the Experian score... which incidently got me to a 720 mid score even with my ugly file.
In situation prepping for a mortgage, it's better to hold cash than fiddling with major installment balances: optimize revolving utilization and see where one is at score wise and DTI wise. If the score is close but not enough because of EX (i.e. it's the low or mid score) then twiddling installment balances might help; if EX is is the high score though, nope. Cash is usually better to hold anyway when talking mortgage process incase the DTI calculation doesn't work or for reserve declaration rather than paying down installment debt.
If you really want the ugly details:
Gory Theory:
http://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/Installment-tradeline-utilization-thread/...
@Revelate wrote:Nah it's not that you're wrong, just likely didn't spend the time reading the awfully ugly thread I started 1.5 years ago and then never went and prettied up where multiple people confirmed it. Also you had a busy file, there's just no rational explanation that installment utilization was the sole factor in your score increase looking at a 90 point jump on EQ.
FICO 8: installment utilization counted.
FICO 04: installment utilization not counted
FICO 98: installment utilization counted.
With all the installment balance tweaks I did (confirmed through both DCU and 1B/3B reports here) in the run up to my mortgage on an incredibly fixed file, I never got FICO 04 to move at all on any bureau: EQ, TU, EX; however they absolutely moved on all of the FICO 8 models, and it did on the one FICO 98 model we have reliable access to.
The overwhelming majority of the mortgage lending space (like 99.999% in the United States) are on EQ 04, TU 04, EX 98 (MF calls them FICO 5, FICO 4, and FICO 2 respectively) and the only one that shifts on that front is the Experian score... which incidently got me to a 720 mid score even with my ugly file.
In situation prepping for a mortgage, it's better to hold cash than fiddling with major installment balances: optimize revolving utilization and see where one is at score wise and DTI wise. If the score is close but not enough because of EX (i.e. it's the low or mid score) then twiddling installment balances might help; if EX is is the high score though, nope. Cash is usually better to hold anyway when talking mortgage process incase the DTI calculation doesn't work or for reserve declaration rather than paying down installment debt.
If you really want the ugly details:
Gory Theory:
http://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/Installment-tradeline-utilization-thread/...
That thread wasn't ugly; it was a thing of dazzling beauty.
I'm pretty sure that's where I learned to play the reindeer game in the first place.
Thing is, while I haven't been able to gauge specifically in my mortgage scores which differences are attributable to the installment utilization numbers, I always pull my monthly report only after the 3 bureaus have reported that month's change. And as you know, I have for the past 7 months been testing installment utilization monthly.
And while there is too much going on in my reports to be scientific about it, I can tell you that nothing else in my reports has changed much. E.g. during this period I've always been in the maximum negative area in my new accounts and inquiries, which I am pretty sure is one of the reasons my mortgage scores are chronically lower than my classic and bankcard scores. And I can also tell you that my credit card utilization has stayed in a narrow range, of from 0 to 2%, and less than a third of cards reporting. I.e., the only major change each month has been the installment utilization number, first going up when the loan hit, and then going down as I paid it down.
So as far as I'm concerned, in my profile, my mortgage scores have acted just like my classic and bankcard scores, only more mildly so. And what's good for the bankcard and classic scores has been, IMHO, good for the mortgage scores. And I believe the reasons my increase is tempered in the mortgage scores is that my profile is (a) so laden with "new" stuff and (b) bereft of any mortgages to report.
@SouthJamaica wrote:
@Revelate wrote:Nah it's not that you're wrong, just likely didn't spend the time reading the awfully ugly thread I started 1.5 years ago and then never went and prettied up where multiple people confirmed it. Also you had a busy file, there's just no rational explanation that installment utilization was the sole factor in your score increase looking at a 90 point jump on EQ.
FICO 8: installment utilization counted.
FICO 04: installment utilization not counted
FICO 98: installment utilization counted.
With all the installment balance tweaks I did (confirmed through both DCU and 1B/3B reports here) in the run up to my mortgage on an incredibly fixed file, I never got FICO 04 to move at all on any bureau: EQ, TU, EX; however they absolutely moved on all of the FICO 8 models, and it did on the one FICO 98 model we have reliable access to.
The overwhelming majority of the mortgage lending space (like 99.999% in the United States) are on EQ 04, TU 04, EX 98 (MF calls them FICO 5, FICO 4, and FICO 2 respectively) and the only one that shifts on that front is the Experian score... which incidently got me to a 720 mid score even with my ugly file.
In situation prepping for a mortgage, it's better to hold cash than fiddling with major installment balances: optimize revolving utilization and see where one is at score wise and DTI wise. If the score is close but not enough because of EX (i.e. it's the low or mid score) then twiddling installment balances might help; if EX is is the high score though, nope. Cash is usually better to hold anyway when talking mortgage process incase the DTI calculation doesn't work or for reserve declaration rather than paying down installment debt.
If you really want the ugly details:
Gory Theory:
http://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/Installment-tradeline-utilization-thread/...That thread wasn't ugly; it was a thing of dazzling beauty.
I'm pretty sure that's where I learned to play the reindeer game in the first place.
Thing is, while I haven't been able to gauge specifically in my mortgage scores which differences are attributable to the installment utilization numbers, I always pull my monthly report only after the 3 bureaus have reported that month's change. And as you know, I have for the past 7 months been testing installment utilization monthly.
And while there is too much going on in my reports to be scientific about it, I can tell you that nothing else in my reports has changed much. E.g. during this period I've always been in the maximum negative area in my new accounts and inquiries, which I am pretty sure is one of the reasons my mortgage scores are chronically lower than my classic and bankcard scores. And I can also tell you that my credit card utilization has stayed in a narrow range, of from 0 to 2%, and less than a third of cards reporting. I.e., the only major change each month has been the installment utilization number, first going up when the loan hit, and then going down as I paid it down.
So as far as I'm concerned, in my profile, my mortgage scores have acted just like my classic and bankcard scores, only more mildly so. And what's good for the bankcard and classic scores has been, IMHO, good for the mortgage scores. And I believe the reasons my increase is tempered in the mortgage scores is that my profile is (a) so laden with "new" stuff and (b) bereft of any mortgages to report.
To clear something up, the "mortgage" scores listed on myFICO are classic ones, no industry options. Having a mortgage made precisely zero difference to my EQ Beacon 5.0 score, I was 693 w/3+ inquiries before mortgage, 700 with 2 inquiries, and I'm still at 693 with 3+ inquiries now. Going from 50% to 9% to ~100% on a mortgage produced no change on FICO 04; FICO 8 swung as expected. Your major change on Equifax I would assert simply cannot be accounted for by installment utilization, 90 points? Nobody has gotten that amount or even half that to my knowledge . Too much of an outlier, something else changed.
Anyway the mortgage industry option scores never caught on in the marketplace, to my knowledge there's no place to even get them not even from myFICO and no lender uses them to my knowledge either... we've only seen one report of a portfolio lender using FICO 8 to underwrite their mortgages; there are probably some others out there but they are exceptionally uncommon, in that 0.001% or so.
