Utilization question

[Anonymous]

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@redbeard wrote:

Quickly is always in reference to what your goal is.

Any card reporting over 90% utilization (on that card) will put you in the penalty box for your score.  Depending on your profile, you could lose 5 - 20 points for this alone.

If you pay it before the statement cuts, then it doesn't report to the CRA's, which means it has no impact on the score.

If you pay it later, then you will get dinged, but then recover once you do pay it.  No real issues if you don't need to apply for credit or if you have breathing room in your profile.  Score will recover once a lower balance reports.

Fico is a very complex algorithm.  We tend to distill it down to some black and white things on this forum, but the truth is, everything interacts with everything, which is why the answer to your original question is 'both'.  

Dan

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Thanks for elaborating more than I felt up to when I answered, well said!  I also want to thank the OP for the question.  It was great for purposes of illustration, especially being I am fairly certain they were not alone in wondering that.  

[Dalmus]

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@redbeard wrote:

Quickly is always in reference to what your goal is.

{snip}

Fico is a very complex algorithm.  We tend to distill it down to some black and white things on this forum, but the truth is, everything interacts with everything, which is why the answer to your original question is 'both'.  

Dan

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 This is so true.  Last month, an inquiry dropped my FICO 8 by 3 points.  This month, another inquiry to the same Bureau RAISED it 2 points.  My balances actually went up from month to month, and I know inquiries ding your score, so I have to think that it was another month added to the AAoA that pushed me over some threshold.

[Anonymous]

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@Dalmus wrote:

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@redbeard wrote:

Quickly is always in reference to what your goal is.

{snip}

Fico is a very complex algorithm.  We tend to distill it down to some black and white things on this forum, but the truth is, everything interacts with everything, which is why the answer to your original question is 'both'.  

Dan

---

 This is so true.  Last month, an inquiry dropped my FICO 8 by 3 points.  This month, another inquiry to the same Bureau RAISED it 2 points.  My balances actually went up from month to month, and I know inquiries ding your score, so I have to think that it was another month added to the AAoA that pushed me over some threshold.

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I want to chime in here with a theory I've posted before and probably will from time to time.   We all know scores change for many reasons, such as balances, and things we have no idea about, plus the mere passing of time.  We also know that myfico(and presumable other services) are not always(to put it mildly) in "real time" with their score changes.  I think it is safe to reckon that a score change updated at the same time an event happens does not necessarily indicate a cause/effect relationship.

I think your example is potentially a great illustration of this, although with the fickle fico, I will not say so with certainty.  I'm curious if others feel the same, and/or if they are ok with me occasioanlly positing this notion on here.   As always, thank you for your support.  

[redbeard]

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@Anonymous wrote:

I want to chime in here with a theory I've posted before and probably will from time to time.   We all know scores change for many reasons, such as balances, and things we have no idea about, plus the mere passing of time.  We also know that myfico(and presumable other services) are not always(to put it mildly) in "real time" with their score changes.  I think it is safe to reckon that a score change updated at the same time an event happens does not necessarily indicate a cause/effect relationship.

I think your example is potentially a great illustration of this, although with the fickle fico, I will not say so with certainty.  I'm curious if others feel the same, and/or if they are ok with me occasioanlly positing this notion on here.   As always, thank you for your support.  

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This is VERY true.  MyFico works on trigger events and not all changes on your report cause a trigger to happen.  For instance, an account deletion does not cause a myFico trigger to happen, but it can cause a huge point swing if it was a derogatory that just got wiped out.  Then along comes an inquiry, which is a trigger event, your score goes up 30 points.  It had nothing to do with the inquiry, but the account being deleted.

The same thing applies to a lot of changes in the Fico score.  myFico doesn't report a lot of things from lates aging to accounts maturing to anything under your trigger values.

So yes, you can 'posit' this notion often.