Understanding FICO® Scoring

[onthemend]

Recently we refinanced three vehicles to lower rates (different lien holder), traded one of those vehicles in and then purchased a new vehicle.  I just got an alert that my credit score dropped 30 points!

Is this a temporary effect while the refinancing things sort out?  Or am I doomed to raise my score again?

[onthemend]

I was really hoping someone could answer this question for me.  Anyone?

[RobertEG]

Yes, you had three credit inquires to get the refinanced new loans, which hit you for about 10 pts each, and will stay on you CR for one year/

[onthemend]

So it will be a year before I'll see that 30 pts again?  I'm about ready to give up on this whole scoring thing.  I've been paying all of my bills on time and thought I was being responsible with credit.  The only reason I refinanced was to get lower rates (and lower payments).  I'll admit the trade-in/new car purchase was a bit irresponsible but it's also a lower payment and lower insurance rates. 

Thanks for the help.

[Noah_Bodie]

If all 3 loans got refinanced within a de-duplication window (which I believe is 45 days), then the INQs count as one.

It's highly doubtful that even 3 INQs could add up to 30 points. Any other negatives on your CRs? What's your CC util?

Message Edited by Noah_Bodie on 09-05-2007 03:56 PM

[onthemend]

If it wasn't within 45 days it was pretty close.  My util is high but no different than previously.  The only thing that was different was the car activity.  It's very frustrating.  Plus, I'm sure I'll take a hit because now those car loans are showing as new accounts with no history. 

Also, I have a high number of accounts (31) but only 7 current open accounts. All of the other accounts show $0 balances, paid as agreed.  That is a big red flag on my report -- is there any way to have those other accounts removed? 

I was doing really well and had gotten myself back into good territory.  A year ago my score wasn't even 500 and I was on the verge of losing my home.  Now, I'm back in the 500s and I'm ready to give up.

[fused]

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RobertEG wrote:

Yes, you had three credit inquires to get the refinanced new loans, which hit you for about 10 pts each, and will stay on you CR for one year/

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I do not agree! With the "de-duplication window", FICO looks at your history for the last 12 months, and when it sees two or more hard inqs for the same type of mortgage or auto loan within a two-week period (30 or 45 days now someone correct me if I am wrong), it will ignore all but one of them as far as scoring is concerned. FICO doesn't treat credit card inquiries like this, BUT THEY SHOULD!!!

[onthemend]

I just looked at my report and it appears that one of the loans that was refinanced reported 30 days past due around the time it was paid off.  How do I dispute?  Do I go to the company or through the bureaus?

[Noah_Bodie]

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onthemend wrote:

I just looked at my report and it appears that one of the loans that was refinanced reported 30 days past due around the time it was paid off.  How do I dispute?  Do I go to the company or through the bureaus?

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If you're on good terms with the lender, call 'em up and ask 'em to fix it.

If they claim they can't, then dispute with the CRA as never late.

[onthemend]

Thanks so much for the help.  This late payment wasn't showing before so maybe that's the reason for the large drop.  I'll call them tomorrow and see what I can do.  Hopefully I won't have to go the dispute route!