cancel
Showing results for 
Search instead for 
Did you mean: 

Ridiculous Scoring Practices

tag
Druid001
New Member

Ridiculous Scoring Practices

I get a lot of ridiculous point deductions once in a while but I still pay for monitoring as the alerts do help me a lot.

 

However they are one step away from an FTC complaint for totally making their scoring based on ridiculous calculations that make no sense though.  I had a $10 charge on a "dormant account" which lowered my score by 21.  It turned out to be a fraudulent transaction and was taken off by the credit issuer, and when the balance went back to 0, my score went up by 6 lol.  Where the remaining 15 points are, only FICO would know.

 

I use cards like Lowe's and Target on a regular basis as I get 5% off my totals every single time, and I do pay them right away within a couple of days.

 

I used my Target card for a $41 purchase and paid it the same night.  However it was reported while the payment was pending, and bleep goes another 21 points down.

 

I had a yearly fee on one card and paid it off 2 days later, there went another 21 points.

 

My score is 773 right now and if they hadn't removed those 21 points and given back the full 21 instead of the "god knows how they came up with that" 6 points, I would currently have a score of 833.

 

It is not affecting me at all at this moment but I am in the process of purchasing a house, and if my rates do go up due to having more stupid point drops like that, the matter is most likely going to go to court. 

 

You spend more than 30% of your max credit on a single card and have less than 5% usage with $100k or $200k total limits, it doesn't matter, you get the automatic ridiculous drop.  You go over 50%, you get another drop.

 

Once I get the house (if I can), I am going to consolidate 4-5 cards that I have low balances into 1 or 2 cards.  It may ruin my score but those 2 cards have half the APR of the next lowest card I am using, and just so that I can have my score go high, I am having to spend more money on interest because FICO thinks that's what is required for your points to go up.  It is above and beyond ridiculous...

 

Also, it is just amazing how credit bureaus can gather your information without your consent, and then sell it to you for viewing your own information.

 

A creditor can put false information or make a mistake in their reporting, and unless you monitor your score, there is nothing you can do about it, so you also have to pay in order to make sure that those people who collect your information don't make any mistakes that would cost you dearly otherwise.  And if you somehow managed to find out about the errors and then wanted to dispute them online, the maximum allowed dispute is 250 characters for 2 of the bureaus, and 150 characters for the other.  The sentence  "good luck explaining anything in 250 characters or less, or in 150 characters" is 80 characters with the quotation marks, so go figure...

Message 1 of 9
8 REPLIES 8
Anonymous
Not applicable

Re: Ridiculous Scoring Practices

It seems like some of your misfortune in score is purely based upon when you used your credit and the reporting of your statement to the bureaus?  As for the 21 point drop and the 6 point increase; well everything on your report in terms of score is based upon an algorithm, that neither you nor I have privy to in the matter.  I'd suggest that you do a bit of score watching if you are app'ing for a mortgage?  If you are looking to get the best rate, you will basically have to curtail use of your cards to some degree, lower your utilization to the least amount and watch them like a hawk.

 

As for complaints and the preceived "unfairness" fo Fico, it's one of those institutional items that is not perfect but necessary.  You wouldn't be the first to be amazed or confused by their scoring process nor the last.  And filing suit agains them for their scoring, good luck with that!  

Message 2 of 9
Druid001
New Member

Re: Ridiculous Scoring Practices

Actually they agreed to "restore" my credit to whatit was before the drop.

BBB complaints don't seem to affect their responses much but after complaining to the Consumer Financial Protection Bureau, and them stating I had basis for a lawsuit seemed to have done the job.

One of the charges that caused the balance to increase and made the "dormant account active" was fraudulent and was removed by the creditor immediately. Equifax didn't even bother investigating, claiming they had, and after the complaint, they actually did investigate it.

Regardless of what their algorithms are, they can not deduce points for for charges and usage that is not mine. If instead of 1 card, the fraudulent charges were made on a dozen accounts, my score would have gone down by over a 100.

What I am trying to say is that once a fraudulent charge is detected, they need to put back whatever points they took off.

My credit is fine, and I have been at the same score give or take 5-10 points up or down for about at least a year. If that extra would have been put back, (and it would have been had they investigated it in the first place.

I have probably around 20 cards or slightly more, and I can't even cancel some because the will lower my score (the one with the is one of my oldest and I do use it a few times a year).

I am also not going to cancel cards which give me 5% discounts every time that I use them, and I sure won't cancel cards with 0 balances and over 10k credit limits as those are something to fall back on if something goes wrong. I was on workers com, totally disabled, and couldn't get a penny from the insurance for almost 3 years about 15 years ago. I literally lived on my cards, and my balances were all maxed; I literally would use the last pennies on it, and when the interest hit, most of them would go over my balance. I had no idea how WC worked but now that I know they try to put you in such a financial situation that in the end, most people are willing to settle for pennies on the dollar or they would literally starve. Anyway, I paid off all those cards, but since there are no guarantees in life that a similar situation won't arise, I am keeping all my cards (have 1 with a yearly fee).

I have around 100k in total limits, have never ever missed a payment in my life whether late or unpaid, and have 3 cards with balances on it, and 2-3 which I always use for the bonuses but that I pay within the week.

Those 3 cards go anywhere from 10-20% of their limits to past 50% because I can't bring myself to use other cards to please FICO and end up throwing out money on interest. 1 of the cards had 4.99% APR, the other has 5.99% while the 3rd one is my lower limit Amazon card which allows me 6 to 12 months of no interest payments. I could divide those accounts to multiple cards and even though my FICO scores would go up, so would the money I pay on interest.

It's just BS algorithms with the purpose of making people think it actually indicates anything while the intended usage is to make money. If they had any interest in providing more accurate patterns and predictive credit behavior, they would take APR's into consideration but why should they waste such effort into it when the existing system brings them millions?

Like everything else around nowadays, they are here to make money since whatever is done is done to make money; if they cared so much about people, they would remain a non-profit agency while only charging enough to pay thr employees but why should they when idiots like me can give them monthly fees and they can sell reports for ridiculous sums when all they so is keep information on hard drives? Anyway, it's fixed but this country is getting more ridiculous every single day and soon they will start.charging us for how much oxygen we use. And nobody seems to remember why this country was formed and broke free from GB while we live like automatons and pay over half we make in taxes and fees...
Message 3 of 9
Anonymous
Not applicable

Re: Ridiculous Scoring Practices


@Druid001 wrote:
Actually they agreed to "restore" my credit to whatit was before the drop.

BBB complaints don't seem to affect their responses much but after complaining to the Consumer Financial Protection Bureau, and them stating I had basis for a lawsuit seemed to have done the job.

One of the charges that caused the balance to increase and made the "dormant account active" was fraudulent and was removed by the creditor immediately. Equifax didn't even bother investigating, claiming they had, and after the complaint, they actually did investigate it.

Regardless of what their algorithms are, they can not deduce points for for charges and usage that is not mine. If instead of 1 card, the fraudulent charges were made on a dozen accounts, my score would have gone down by over a 100.

What I am trying to say is that once a fraudulent charge is detected, they need to put back whatever points they took off.

My credit is fine, and I have been at the same score give or take 5-10 points up or down for about at least a year. If that extra would have been put back, (and it would have been had they investigated it in the first place.

I have probably around 20 cards or slightly more, and I can't even cancel some because the will lower my score (the one with the is one of my oldest and I do use it a few times a year).

I am also not going to cancel cards which give me 5% discounts every time that I use them, and I sure won't cancel cards with 0 balances and over 10k credit limits as those are something to fall back on if something goes wrong. I was on workers com, totally disabled, and couldn't get a penny from the insurance for almost 3 years about 15 years ago. I literally lived on my cards, and my balances were all maxed; I literally would use the last pennies on it, and when the interest hit, most of them would go over my balance. I had no idea how WC worked but now that I know they try to put you in such a financial situation that in the end, most people are willing to settle for pennies on the dollar or they would literally starve. Anyway, I paid off all those cards, but since there are no guarantees in life that a similar situation won't arise, I am keeping all my cards (have 1 with a yearly fee).

I have around 100k in total limits, have never ever missed a payment in my life whether late or unpaid, and have 3 cards with balances on it, and 2-3 which I always use for the bonuses but that I pay within the week.

Those 3 cards go anywhere from 10-20% of their limits to past 50% because I can't bring myself to use other cards to please FICO and end up throwing out money on interest. 1 of the cards had 4.99% APR, the other has 5.99% while the 3rd one is my lower limit Amazon card which allows me 6 to 12 months of no interest payments. I could divide those accounts to multiple cards and even though my FICO scores would go up, so would the money I pay on interest.

It's just BS algorithms with the purpose of making people think it actually indicates anything while the intended usage is to make money. If they had any interest in providing more accurate patterns and predictive credit behavior, they would take APR's into consideration but why should they waste such effort into it when the existing system brings them millions?

Like everything else around nowadays, they are here to make money since whatever is done is done to make money; if they cared so much about people, they would remain a non-profit agency while only charging enough to pay thr employees but why should they when idiots like me can give them monthly fees and they can sell reports for ridiculous sums when all they so is keep information on hard drives? Anyway, it's fixed but this country is getting more ridiculous every single day and soon they will start.charging us for how much oxygen we use. And nobody seems to remember why this country was formed and broke free from GB while we live like automatons and pay over half we make in taxes and fees...

Why do you think canceling a card will lower your score?  Unless somehow it dramatically affects your overall utilization, the mere act of closing a card has no effect whatsoever on your score.

Message 4 of 9
Druid001
New Member

Re: Ridiculous Scoring Practices

My oldest cards are low limit useless cards buy they help the average account age. I have about half a dozen of them left, and when I had canceled a card I had obtained around 2001 3 or 4 years ago, it gave me a 16 or 18 point drop on my Equifax score. It took about a year to get the points back with other things, and the remaining accounts had aged another year as well by then.

I haven't used any of them in probably 5 or 6 years at least but as soon as I get my mortgage, those cards are going bye bye regardless of how they affect my score as I intend on piling up all spending into 2 of my lowest APR cards and on any new cards I may get with promotional 0 APR. Eventually they'll get paid off and I'll only use cards for their bonuses and pay them off right away (unless I lose my income or something and would have to temporarily depend on cards to survive).

Nothing good gets scored accordingly while the smallest bad thing is deducted as if you had declared bankruptcy. After all the whole purpose is to deduct your points in any way possible so that you end up spending money on monitoring services and spending money on credit reports (I use monitoring services but don't waste my money on reports since you can see them while you dispute something).

I had a 20k car loan at almost 10% and then switched to another bank at 4.99%, and I got points deducted for having a "new revolving account" while I got nothing for having the 20k account paid off. I would have the "age of revolving accounts not old enough" comments on credit denials hehe. not to mention, when I switched to another lender, the balance had gone to 10.5k or so. So having 10k paid is obviously not important while having a balance go to 10 (ten) dollars from 0 is worth a 42 point deduction (21 for dormancy and 21 for a balance), even though it was a fraudulent transaction made to some Brazilian telecom company in Rio de Janeiro.

And then I had the car loan switched to Penfed at 1.49%, and again, I got no increase in points for it while again I saw the "age of revolving accounts too low" (or too recent) message on another denial.

Anyway, once I get my mortgage, I am done with scores. I don't intend on getting any new cards, and if I can't afford major expenses with cash, then I won't be making them while I will continue to use what I have for discounts and points/miles. They can continue to rake in money and getting filthy rich without my contributions.
Message 5 of 9
Druid001
New Member

Re: Ridiculous Scoring Practices

And after all the typing, I got an alert that my Capital One account balance had decreased from $10 to 0 with no points added to my score. That's the fraudulent transaction that was deleted by Capital one and for which I was deducted 21 points for the $10, and 21 points for it being a dormant card with new activity on it.

I already had it showing as 0 with a 6 point increase after I had disputed it, then a week later it showed $10 again saying nothing was found to be inaccurate (which they didn't even investigate as Capital One immediately had removed it). Now it's gone again and the balance accurately shows 0, and I'm still missing 36 points for a transaction I did not make.

That's the one they agreed to correct, so ill give them 10 days and then will let the CFPB know if nothing happens.
Message 6 of 9
Anonymous
Not applicable

Re: Ridiculous Scoring Practices


@Druid001 wrote:
My oldest cards are low limit useless cards buy they help the average account age. I have about half a dozen of them left, and when I had canceled a card I had obtained around 2001 3 or 4 years ago, it gave me a 16 or 18 point drop on my Equifax score. It took about a year to get the points back with other things, and the remaining accounts had aged another year as well by then.

I haven't used any of them in probably 5 or 6 years at least but as soon as I get my mortgage, those cards are going bye bye regardless of how they affect my score as I intend on piling up all spending into 2 of my lowest APR cards and on any new cards I may get with promotional 0 APR. Eventually they'll get paid off and I'll only use cards for their bonuses and pay them off right away (unless I lose my income or something and would have to temporarily depend on cards to survive).

Nothing good gets scored accordingly while the smallest bad thing is deducted as if you had declared bankruptcy. After all the whole purpose is to deduct your points in any way possible so that you end up spending money on monitoring services and spending money on credit reports (I use monitoring services but don't waste my money on reports since you can see them while you dispute something).

I had a 20k car loan at almost 10% and then switched to another bank at 4.99%, and I got points deducted for having a "new revolving account" while I got nothing for having the 20k account paid off. I would have the "age of revolving accounts not old enough" comments on credit denials hehe. not to mention, when I switched to another lender, the balance had gone to 10.5k or so. So having 10k paid is obviously not important while having a balance go to 10 (ten) dollars from 0 is worth a 42 point deduction (21 for dormancy and 21 for a balance), even though it was a fraudulent transaction made to some Brazilian telecom company in Rio de Janeiro.

And then I had the car loan switched to Penfed at 1.49%, and again, I got no increase in points for it while again I saw the "age of revolving accounts too low" (or too recent) message on another denial.

Anyway, once I get my mortgage, I am done with scores. I don't intend on getting any new cards, and if I can't afford major expenses with cash, then I won't be making them while I will continue to use what I have for discounts and points/miles. They can continue to rake in money and getting filthy rich without my contributions.

Closing old credit cards does not affect AAoA as they stay on your credit reports for 10 years so if you want to close them, close them and they will affect your score one bit.

Message 7 of 9
Druid001
New Member

Re: Ridiculous Scoring Practices

Thank you for the info.

The only thing is that their last used date is under 10 years before the balances went to 0 and stayed there. I have 2 that also showed balances in the last year which turned out to be fraudulent, so they had activity in the last year. Would having activity cause a problem though?

And if you are wondering "why does this guy have so much fraudulent usage on his cards", I think one of the major online retailers has been compromised. I had 2 debit and 3 credit cards with fraudulent activity on them in the last 7 months or so. One of the cards has not been used in at least 2 or 3 years, and hasn't left the house either in that time frame. However there are three sites which may have all those accounts stored, and 2 are owned by the same place (not going to give names). I did contact them and they never replied, I also federal authorities let know o my suspicions but it was a hot line, so I never heard from them either. And no, I don't go calling companies but this the first time I had more than a single card get used fraudulently when I may have had maybe 2 total incidents in 10+ years with dozens of cards.
Message 8 of 9
Anonymous
Not applicable

Re: Ridiculous Scoring Practices


@Druid001 wrote:
Thank you for the info.

The only thing is that their last used date is under 10 years before the balances went to 0 and stayed there. I have 2 that also showed balances in the last year which turned out to be fraudulent, so they had activity in the last year. Would having activity cause a problem though?

And if you are wondering "why does this guy have so much fraudulent usage on his cards", I think one of the major online retailers has been compromised. I had 2 debit and 3 credit cards with fraudulent activity on them in the last 7 months or so. One of the cards has not been used in at least 2 or 3 years, and hasn't left the house either in that time frame. However there are three sites which may have all those accounts stored, and 2 are owned by the same place (not going to give names). I did contact them and they never replied, I also federal authorities let know o my suspicions but it was a hot line, so I never heard from them either. And no, I don't go calling companies but this the first time I had more than a single card get used fraudulently when I may have had maybe 2 total incidents in 10+ years with dozens of cards.

It's possible that you've been the victim of identity theft.  Consider reviewing the thread about how to deal with that issue.

Message 9 of 9
Advertiser Disclosure: The offers that appear on this site are from third party advertisers from whom FICO receives compensation.