topic Re: lost 100 points in less than a week:( in Understanding FICO® Scoring

lost 100 points in less than a week:(

Anonymous — Tue, 15 Dec 2015 07:46:51 GMT

hello...this is my first post but i been looking in the forums for some time.

i been in file with trans union from 1994 but never have a credit card or anything till 2014

open a secure credit card in march 2014 with bank of america.deposit 300 $

use the card and pay in full every month.after 7 month i ceck my fico score on october 20 and show like this

trans union 705 equifax 719 experian 720

have only one hard pull with bank of america reported with trans union only.

no late payments.no badies,nothing bad in my credit file

apply on november 4 and got aproved for chase freedom for $ 500 credit line.

one week later my scores drops 9 points.

on november i ceck again my fico score and see a drop of 100 points

trans union 609 equifax 634 experian 635

i did use use the chase credit card $465 and see that in novermber 20 chase reported credit utilization 64%

since november 28 both cards are pay in full and have $0 balance.

can you lose 100 points because credit utilization reported balance 465$ on chase freedom and 42$ on bank of america credit card

like i say...i have nothing bad in mu credit history.no late payment...nothing...only 2 credit cards boa 300 secured and chase freedom 500 unsecured

and 2 hard pulls reported only in trans union boa and chase freedom.

75k income.any help or advise are welcome.thanks

Re: lost 100 points in less than a week:(

TrialByFire — Tue, 15 Dec 2015 07:32:33 GMT

Utilization accounts for 30% of your score and can definitely have a major impact. You're currently at 63% utilization. But there's good news...util impact is only temporary, and if you paid your $465 freedom balance to 0, Chase will report it to the bureaus mid-cycle. You should see your scores recover in a few days.

Re: lost 100 points in less than a week:(

TrialByFire — Tue, 15 Dec 2015 07:39:02 GMT

Also welcome to the forums!

I want to add this...try not to let more than 10% report for maximum scoring purposes. For example, pay the bofa card to 0 and try not to let your freedom statement cut with more than 40 or $50 on it. Unless you're gonna apply for new credit soon, try to keep it under 30% and you'll be golden. There's a lot of great info around here on this exact topic, enough to get lost in for a couple hours

Re: lost 100 points in less than a week:(

Shogun — Tue, 15 Dec 2015 08:11:14 GMT

New account, drop in AAoA, high until, it all adds up, might have had a rebuke to in there. But all in all not a bad thing. Get the until down, let the accounts age. You will be fine.

Re: lost 100 points in less than a week:(

Anonymous — Tue, 15 Dec 2015 09:09:47 GMT

How would folks feel about the OP opening another unsecured card with a potentially higher SL than the Chase, in order to be able to buy dinner without killing utilization so quickly? Would it be a sound long term strategy while providing the bonus of immediate score relief with utilization? If so, what companies come to mind first?

Re: lost 100 points in less than a week:(

Anonymous — Tue, 15 Dec 2015 14:14:53 GMT

@Anonymous wrote:
How would folks feel about the OP opening another unsecured card with a potentially higher SL than the Chase, in order to be able to buy dinner without killing utilization so quickly? Would it be a sound long term strategy while providing the bonus of immediate score relief with utilization? If so, what companies come to mind first?

Sounds like good advse. Hard for the op to keep his score up if he spends $200 and hits 20% utilization. Hard hit on his report would be a drawback but looks like every time he uses his card he kills his score. Good thing with chase is they are quick to report when the card is paid off. I noticed citi is much slower eventhough I pay my card off the day the bill posts the balance still shows on my report for the month. Other option would be to use a debit card to keep utilization low for the time being and in a year ask for a CLI.

Re: lost 100 points in less than a week:(

takeshi74 — Tue, 15 Dec 2015 15:39:04 GMT

@Anonymous wrote:
can you lose 100 points because credit utilization reported balance

Any impact always depends on one's crdit profile. You have some credit history but with no cards you had and even with 2 cards you have thin profile. Impact can be bigger for many things with such a profile. You have to gradually build as your profile will only support small changes over a given period of time. This will change as your profile thickens and improves, assuming responsible usage and management.

Revolving utilization is certainly a significant factor. General advice is do not exceed 30%. 30% is far above ideal though. With low limits it can be tricky to keep utilization low but you can pay down balances prior to report date.

@Anonymous wrote:

since november 28 both cards are pay in full and have $0 balance.

That's good but keep in mind that a score is generated based on the data in a report. Scoring models do not have access to your current account status and activity. They can only refer to what is on the report being used as a data source.

@TrialByFire wrote:
Utilization accounts for 30% of your score and can definitely have a major impact.

Amounts Owed is 30%.

http://www.myfico.com/crediteducation/whatsinyourscore.aspx

Revolving utilization falls under that and has a significant impact but Amounts Owed is not based only on revolving utilization.

@Anonymous wrote:
How would folks feel about the OP opening another unsecured card with a potentially higher SL than the Chase, in order to be able to buy dinner without killing utilization so quickly?

I'm doubftul that the OP's profile would support another unsecured card right now. The OP should add another card but might need to give it some time. As shogun stated, it's not just revolving utilization but the hit to AAoA, the hit from the HP's, etc.

Again, revolving utilization can be maanged by paying down balances prior to report dates. it does not always require additional available credit though that can help especially with lower limits.

Re: lost 100 points in less than a week:(

Anonymous — Wed, 16 Dec 2015 02:20:42 GMT

I've noticed after monitoring my report almost every day that it will fluctuate through the month. If you charged up that much doing a certain day and it reports it lowers your score till it reports again.

Re: lost 100 points in less than a week:(

Anonymous — Wed, 16 Dec 2015 05:45:55 GMT

thanks so much for the help!!!.i will keep utilization under 10% pay off in full before due date and in couple months apply for one more credit card.this community forum it's been very helpful for me.thanks again

Re: lost 100 points in less than a week:(

Anonymous — Thu, 17 Dec 2015 05:06:38 GMT

I am going to go against the grain here. Not only should you apply for another card, you should apply for two. I would suggest applying for a Capital One Platinum, and a Cap One QS1. Apply back to back, same broswer session, no waiting. They will probably start you off at $300/$500, but they will grow very quickly - easily to $3-5k in six months, as long as you use them a lot. You can request CLI after the second/third statement and they do an automatic increase after the fifth statement. If they grow like most they should go to $2300/$3500. Thats what mine did. And my file is anything but clean. When mine got to that level at the end of august I combined them into a single $5800 card and opened another platinum card, which has already been bumped up to $1500. In a years time when Chase is *ready* to give you a cli, you could have a $10k credit line at Cap One.

Re: lost 100 points in less than a week:(

Thomas_Thumb — Fri, 18 Dec 2015 01:03:22 GMT

@Anonymous wrote:
hello...this is my first post but i been looking in the forums for some time.
i been in file with trans union from 1994 but never have a credit card or anything till 2014
open a secure credit card in march 2014 with bank of america.deposit 300 $
use the card and pay in full every month.after 7 month i ceck my fico score on october 20 and show like this
trans union 705 equifax 719 experian 720
have only one hard pull with bank of america reported with trans union only.
no late payments.no badies,nothing bad in my credit file
apply on november 4 and got aproved for chase freedom for $ 500 credit line.
one week later my scores drops 9 points.
on november i ceck again my fico score and see a drop of 100 points
trans union 609 equifax 634 experian 635
i did use use the chase credit card $465 and see that in novermber 20 chase reported credit utilization 64%
since november 28 both cards are pay in full and have $0 balance.
can you lose 100 points because credit utilization reported balance 465$ on chase freedom and 42$ on bank of america credit card
like i say...i have nothing bad in mu credit history.no late payment...nothing...only 2 credit cards boa 300 secured and chase freedom 500 unsecured
and 2 hard pulls reported only in trans union boa and chase freedom.
75k income.any help or advise are welcome.thanks

Nothing to be concerned about as you have done nothing to damage your credit. You are a newbie with thin credit - so your scores are more susceptable to swings. A few things are in play:

1) Thin account with new card reporting can create shock waves & tank score temporarily. Impact will dissipate completely in a month or two.

2) The high utilizaqtion on the new card (465 out of 500 is actually 93% for the card) and that is red flag max out territory - a max out on a thin file with no history is A BIG DEAL for scoring. Fortunately, card utilization has no memory and you get a fresh start next month. I would strongly suggest keeping reported card utilization onder 50% and preferrably under 30%..

3) Your total charges appear to be $507 witha combined CL of $800. This computes to 63% aggregate utilization - another red flag. Aggregate utilization should be maintained below 30% to avoid substantial scoring penalities.

4) The new inquiry could cost you 10 to 15 points on whatever CRA it is listed on. As an FYI inquiry Impact lingers for 12 months. No problem here as that is the price of establishing credit and you should continue on - get a 3rd card after your "out of control" reported utilization is reduced to "acceptable" levels

5) lastly,, you reported balances on 100% of your open accounts. If you have more than one account, this is a minor infraction and can contribute a 5 to 10 point deduct. However, don't worry about this trivial infraction as you should use and report some balance on both cards to build credit history - IMO. Once you have 3 cards, then consider reporting a balance on no more than 2 each month. Ultimately, you should get 3 unsecured credit cards and lose the secured one.

Your score drop, while severe, is not unexpected given the circumstance. The severity of such transgressions will diminish as you build a solid payment history and a critical mass of accounts. Key point is never pay late and try to avoid maxing out credit lines.

Thanks for sharing your story.

Re: lost 100 points in less than a week:(

Thomas_Thumb — Fri, 18 Dec 2015 00:42:21 GMT

Double posted - not sure why

Re: lost 100 points in less than a week:(

elim — Fri, 18 Dec 2015 01:00:39 GMT

@Anonymous wrote:
I am going to go against the grain here. Not only should you apply for another card, you should apply for two. I would suggest applying for a Capital One Platinum, and a Cap One QS1. Apply back to back, same broswer session, no waiting. They will probably start you off at $300/$500, but they will grow very quickly - easily to $3-5k in six months, as long as you use them a lot. You can request CLI after the second/third statement and they do an automatic increase after the fifth statement. If they grow like most they should go to $2300/$3500. Thats what mine did. And my file is anything but clean. When mine got to that level at the end of august I combined them into a single $5800 card and opened another platinum card, which has already been bumped up to $1500. In a years time when Chase is *ready* to give you a cli, you could have a $10k credit line at Cap One.

these are my thoughts... thicken it up while the scores aren't important, then let them all age together. wait until your utilization reports the pay-off before you apply. I bet Cap1 will give you decent starting limits.

whatever you decide to do... best of luck at it :]

edit: may as well throw in a Share Secured Loan from your local CU

Re: lost 100 points in less than a week:(

Anonymous — Sat, 19 Dec 2015 07:10:34 GMT

to thomas _tumb.thanks so much for the help and advise..one of the best

thanks again to all for the help