topic Re: Is this normal? in Credit Cards

Is this normal?

mipema — Fri, 28 Mar 2008 19:36:44 GMT

The following are my FICO scores from September of last year which is the first time I've pulled them.

TU: 706 EQ: 693 EX: 705 - 9/24/07
TU: 706 EQ: 690 EX: 705 - 1/15/08
TU: 706 EQ: 693 EX: 705 - 1/22/08
TU: 701 EQ: 693(2/14/08) EX: 705 - 2/13/08
TU: 702 EQ: 693 EX: 705 - 3/21/08

Since then,

WAMU raised my CL by 50% from 2k to 3k (No inquiry)
I've converted a 10k Delta Amex Skymiles to a Blue cash (No inquiry)
Had an inquiry for a mortgage (TU, EX, and EQ)
Hard pull to double the CL on my bank issued Visa to 10k (TU)
Had HSBC close my $750 MC account b/c of inactivity - BOO!!!! I HATE HSBC
Opened a 3k Discover More (TU)
Opened a 2k Citi Platinum Select MC - Just opened this week and have not received the card (Not sure who they pulled from - yet)
Possibly some others I may be forgetting, but nothing bad - I know C(r)ap1 increased my CL, but I can't recall if that was prior to 9/07.

And, finally...

About to apply for a mortgage in the next week

My scores have not budged. No baddies for 38 months. I generally PIF every month, so it's quite rare that I ever carry a balance if at all. Am I doing something wrong, or is it normal to have scores which don't budge? Thanks for the anticipated replies.

Message Edited by mipema on 03-28-2008 03:36 PM

Re: Is this normal?

MidnightVoice — Fri, 28 Mar 2008 19:10:55 GMT

My scores (780s) have hardly budged for months (about 5) even though I have had new credit (auto, Amex, B&N AU). The exception was yesterday when I got an 11 point drop for one inq (reducing Heloc APR), which is rather ironic.

Re: Is this normal?

Anonymous — Fri, 28 Mar 2008 19:12:53 GMT

My understanding from reading these boards is that the CRAs like to see you carry a balance of 1 - 9% on fewer than half of your cards, as opposed to 0 balances on all. This shows wise credit management. So, instead of PIF-ing all cards, why not try letting one or two of your cards carry a balance of about 1%. Once the balance hits your CR (usually shortly after statement drop), PIF to avoid interest charges. That might help nudge up your scores.

Other than that, I dunno. Personally I'm a bit jealous you haven't seen a hit from the inquiries - share your secret!

Re: Is this normal?

Anonymous — Fri, 28 Mar 2008 19:15:27 GMT

desifink wrote:

My understanding from reading these boards is that the CRAs like to see you carry a balance of 1 - 9% on fewer than half of your cards, as opposed to 0 balances on all.

Just to clarify: CRAs don't care what you do. All they do is store the information and generate reports when requested. FICO is the one that cares; that's the scoring formula used to generate a score based on data from a CRA report.

Re: Is this normal?

Anonymous — Fri, 28 Mar 2008 19:18:17 GMT

Something I've never understood is why completely identical reports from 2 different CRAs produce different FICO scores when they are supposed to use the same scoring model.

Re: Is this normal?

Anonymous — Fri, 28 Mar 2008 19:21:30 GMT

FretlessMayhem wrote:
Something I've never understood is why completely identical reports from 2 different CRAs produce different FICO scores when they are supposed to use the same scoring model.

They don't use the same scoring model. Each CRA uses a different version of FICO tweaked ever so slightly to their specifications.

TU hates too many accounts with balances and not having a mortgage, while EQ hate new accounts.

Just a couple of examples.

Re: Is this normal?

MidnightVoice — Fri, 28 Mar 2008 19:23:57 GMT

cheddar wrote:

while EQ hate new accounts.

Semms to hate the Inqs more than the new accounts, at least for me

Re: Is this normal?

mipema — Fri, 28 Mar 2008 19:24:01 GMT

desifink wrote:
My understanding from reading these boards is that the CRAs like to see you carry a balance of 1 - 9% on fewer than half of your cards, as opposed to 0 balances on all. This shows wise credit management. So, instead of PIF-ing all cards, why not try letting one or two of your cards carry a balance of about 1%. Once the balance hits your CR (usually shortly after statement drop), PIF to avoid interest charges. That might help nudge up your scores.

Other than that, I dunno. Personally I'm a bit jealous you haven't seen a hit from the inquiries - share your secret!

So basically, as far a FICO is concerned, it is a bad idea to have paid my Macy's visa today, (which is due sometime around the middle of May), as when this reports it will have done so with a zero balance?

I too, am a bit shocked that I haven't seen a significant drop, if for no other reason the opening of new accounts, which is why I asked if this is normal behavior. I was wondering if my credit file is split or somehow "messed up".

Re: Is this normal?

Anonymous — Fri, 28 Mar 2008 19:26:21 GMT

MidnightVoice wrote:

cheddar wrote:

while EQ hate new accounts.

Semms to hate the Inqs more than the new accounts, at least for me

Well, my EQ has 8 of each (inqs and new accounts), so I'm not sure which it hates more!

Re: Is this normal?

MidnightVoice — Fri, 28 Mar 2008 19:31:58 GMT

cheddar wrote:

Well, my EQ has 8 of each (inqs and new accounts), so I'm not sure which it hates more!

8 new accounts - I have had 8 new accounts in the last 7 years!

Re: Is this normal?

Anonymous — Fri, 28 Mar 2008 19:35:18 GMT

MidnightVoice wrote:

cheddar wrote:

Well, my EQ has 8 of each (inqs and new accounts), so I'm not sure which it hates more!

8 new accounts - I have had 8 new accounts in the last 7 years!

Eight new accounts is what happens when you're rebuilding.

Ask me seven years from today how many new accounts I have and I'll probably say zero.

Re: Is this normal?

Anonymous — Fri, 28 Mar 2008 19:38:23 GMT

What are you doing wrong?

"I generally PIF every month, so it's quite rare that I ever carry a blance if at all".

This is a good thing to do fiscally-speaking, but not fico-speaking

Re: Is this normal?

MidnightVoice — Fri, 28 Mar 2008 19:38:27 GMT

My last 8 accounts - mortgage Refi: Heloc: Car: one CC change (upgraded CU):3 new CCs and 1 AUship

Re: Is this normal?

MidnightVoice — Fri, 28 Mar 2008 19:39:41 GMT

cobra19 wrote:
What are you doing wrong?

"I generally PIF every month, so it's quite rare that I ever carry a blance if at all".

This is a good thing to do fiscally-speaking, but not fico-speaking

Piffing does not always mean carrying a zero balance. I Pif every month but rarely bother to PIFIA, so I rarely carry zero

Re: Is this normal?

mipema — Fri, 28 Mar 2008 19:45:44 GMT

Thanks for the replies.

It seems to me from what I've read, that the best course of action for me is to let my cc's (less than half of them) report a small balance (roughly 1%) from month to month - even though the score simulator says I should pay down 90-100% of my balances, which are virtually non-existent. Am I interpreting this correctly?

If so, I would be most comfortable doing that with my Citi card (I haven't received as of yet) as it has a 0.0% APR on purchases and BT's through 4/1/09, and after that 9.9% on purchases and BT's.

Re: Is this normal?

Anonymous — Fri, 28 Mar 2008 22:13:15 GMT

cheddar wrote:

desifink wrote:
My understanding from reading these boards is that the CRAs like to see you carry a balance of 1 - 9% on fewer than half of your cards, as opposed to 0 balances on all.
Just to clarify: CRAs don't care what you do. All they do is store the information and generate reports when requested. FICO is the one that cares; that's the scoring formula used to generate a score based on data from a CRA report.

Thanks Cheddar - I'm still trying to get all the lingo down.

Re: Is this normal?

haulingthescoreup — Fri, 28 Mar 2008 23:27:51 GMT

@mipema wrote:

Thanks for the replies.

It seems to me from what I've read, that the best course of action for me is to let my cc's (less than half of them) report a small balance (roughly 1%) from month to month - even though the score simulator says I should pay down 90-100% of my balances, which are virtually non-existent. Am I interpreting this correctly?

If so, I would be most comfortable doing that with my Citi card (I haven't received as of yet) as it has a 0.0% APR on purchases and BT's through 4/1/09, and after that 9.9% on purchases and BT's.

OK, to try to boil it down (not my strong point!):

For scoring, it's not good to allow all your cards to report balances, even if you immediately pay them off, and don't have to pay interest. FICO uses the balance due reported by the CCC's, which is generally the figure posted on your monthly statement. This makes it look like you're carrying balances on all your cards and have a lot of debt.

For scoring, it's not good to allow all your cards to report $0 balances, even if you used your card earlier in the month and paid it off before the statement dropped. To FICO, this looks as if you're too scared to use your credit.

For ideal FICO scoring purposes, allow one or two of your CC's to report a small balance. It (or they) should report 9% or less of its credit limit. Once you let it report, don't forget to pay it off!

About once a month or so (hmmm, I'm due again), I carp at the FICO people that they need to hire an English major to rewrite some of their material. When the sims say that your best bet is to pay down your cards over the next 24 months, they're really trying to say "Get your balances under 10% ASAP, keep them under 10% for the next 24 months, and keep your nose clean." I got this message when I had an $8 total balance out of $50-some-odd K total credit.

Do you have a long total history? My total history is 18+ years, although my average history is ludicrously short, and TU did give me higher scores for having $0 on all. But the other two were happy with one or two cards with minimal balances, and I think that this is a TU quirk for those with long histories.

More to the point, what are your negatives on screen two for all three scores, and your positives for EQ and TU? (EX won't play nicely and tell you your positives, or give you a sim.) I don't know that these are a whole lot more trustworthy than the Whoopi Goldberg character in Ghost, but I use them as a guideline to what changes I might want to make in my overall credit profile.

Re: Is this normal?

Anonymous — Fri, 28 Mar 2008 23:37:21 GMT

so i have a credit card that I have had for 1 yr. now this month and it's a small balanced card that I charge on and then pay off each month. I have never paid interest since opening this card. So if I understand correctly.. as long as the OC reports a balance all the time whatever amount it states.. that 's a good thing.. and it shows that I am using my credit responsibly and to my benefit never paying interest.

Re: Is this normal?

unknown_entity — Fri, 28 Mar 2008 23:55:23 GMT

Reporting balances that are less than 10% of your total available credit, is a good thing. maybe 9%.

Re: Is this normal?

haulingthescoreup — Sat, 29 Mar 2008 00:08:37 GMT

@Anonymous wrote:

so i have a credit card that I have had for 1 yr. now this month and it's a small balanced card that I charge on and then pay off each month. I have never paid interest since opening this card. So if I understand correctly.. as long as the OC reports a balance all the time whatever amount it states.. that 's a good thing.. and it shows that I am using my credit responsibly and to my benefit never paying interest.

Is this your only card? If so, then yes, let that small balance report, and then pay it off. This is good credit sense (allowing a small balance to report) and good financial sense (paying it off so that you don't have to pay interest.)

If you have two or more cards, say up to four cards, just let one report a balance. For five or more cards, let two report a balance. This means paying cards down or off before the next statement is due to post. Again, if you do allow a balance to report, once that statement posts with the balance, be sure to then pay it off well before the due date.

And it is possible to use your cards A LOT, and put lots of charges on them, and still do the early pay tactic. So for instance, with a $1,000K card, you can repeatedly put up to $800-900 on it, pay it off, charge, pay it off, all within one month's cycle; 4-5 days before the next statement is due to drop, pay it down to $80, let that report for 8% util, and pay it off. And then start all over again. Your CCC (credit card company) will love you for using it a lot, FICO will love you for controlling the balance figure that reports, and you will need lots of naps!