topic Re: Exp 08 went up , mortgage went down in Understanding FICO® Scoring

Exp 08 went up , mortgage went down

Sbrooks1 — Fri, 21 Oct 2016 23:58:11 GMT

Gained 38 points up to 728 in 08 for a paid auto loan, still currently have open auto and furniture and student loan! Exp mortgage score dropped 10 points to 666 , which kind of freaks me out😬Can someone elaborate on what I should be doing to bring those mortgage versions up!!

Re: Exp 08 went up , mortgage went down

Anonymous — Sat, 22 Oct 2016 00:51:04 GMT

Congrats for scoring 666. You are the Prince of Darkness.

Can you describe, for your open installment loans only....?

(a) The sum total of what you currently owe

(b) The sum total of what the loans were originally for

That would include your student loans, auto loans, etc. Do not include closed loans.

Have you paid all your cards down to zero except one? (AZEO) The remaining card should be:

(a) A true credit card (not a "charge" chard)

(b) A card in your name (not an AU card)

A score in the mid 600s suggests that you may have "negative" items on your report. (Lates, chargeoffs, liens, collections, etc.) Can you describe those? There are ways to get those removed, though it may take a while.

Can you describe more fully why you want your mortgage scores to go up? Is this because you will be buying a house soon? If so, when?

Re: Exp 08 went up , mortgage went down

Sbrooks1 — Sat, 22 Oct 2016 01:05:02 GMT

Yes , hoping to app for mortgage . Exp has no CO, No lates, rating is exceptional on payment history , only baddie is one 84 medical collection and aaoa is 2.7 years

Re: Exp 08 went up , mortgage went down

Sbrooks1 — Sat, 22 Oct 2016 01:06:06 GMT

Also fico 7 is 728, not mid 600. So something is keeping down my mortgage scores and even dropping it as it was last week 678

Re: Exp 08 went up , mortgage went down

Sbrooks1 — Sat, 22 Oct 2016 01:06:26 GMT

Fico 8.. sorry

Re: Exp 08 went up , mortgage went down

Sbrooks1 — Sat, 22 Oct 2016 01:07:11 GMT

And yes , I only let my Citi report 2$, uti 1%

Re: Exp 08 went up , mortgage went down

Anonymous — Sat, 22 Oct 2016 01:13:20 GMT

I am guessing that "84 medical collection" means an $84 Medical Collection (rather than one that traces back to 1984). You do not mention whether the collection has been paid or not. Also, how old is the collection?

I asked several other questions. If you answer them, I'll be glad to help you. You may find it useful to use the QUOTE button and then answer each one. That way you can be sure you are answering them all.

Re: Exp 08 went up , mortgage went down

Sbrooks1 — Sat, 22 Oct 2016 01:21:40 GMT

I don't know what the quote button is! Assuming that the 04 version pays more attention to installments, and I paid off my 3 yr old auto loan for a brand new auto loan! Yes, 84$ medical collection 6.7 yrs old paid

Re: Exp 08 went up , mortgage went down

Anonymous — Sat, 22 Oct 2016 02:06:00 GMT

Here is my first response with a lot of questions. I will place in red the questions you still have not answered. I will add in blue partial answers that that you may have in given so far.

Can you describe, for your open installment loans only....?

(a) The sum total of what you currently owe

(b) The sum total of what the loans were originally for

That would include your student loans, auto loans, etc. Do not include closed loans.

Have you paid all your cards down to zero except one? (AZEO) The remaining card should be:

(a) A true credit card (not a "charge" chard)

(b) A card in your name (not an AU card)

I think you said that all of your cards are reporting at $0 except a Citi card, which you said is reporting at $2. Is that right? You'll see that this may be too small of a number. A few dollars more would be safer. Also can you confirm that is not an AU card?

Can you tell me how many cards are reporting at $0?

You later point out that your score is in the 700s. However this is your FICO 8 which is not relevant to mortgage decisions. Good to know what you have no derogs except a paid collection that is 6.7 years old. Your collection is no doubt harming your mortgage scores (FICO 8 ignores paid collections < $100). Your collection will fall off your reports at exactly 7 years (might need one more month beyond that). Thus, if you are right that the collection is 6.7 years old you just need to wait another 4-5 months before you go through pre-approval. Is that doable?

Can you describe more fully why you want your mortgage scores to go up? Is this because you will be buying a house soon? If so, when?

Re: Exp 08 went up , mortgage went down

Sbrooks1 — Sat, 22 Oct 2016 14:00:58 GMT

Ok thanks for the reply!
Toyota Finance 22079/22542
Conns 2348/3231
Student loan 6988/7507
4 open cc with 1 @1% uti per CCT this am, all are my cards and not AU
I get the collection holding it down, but do not get how a 30 put jump in one version =a loss of pets in another😢
Def plan on waiting until that collection is off , may try a request EE soon

Re: Exp 08 went up , mortgage went down

Revelate — Sat, 22 Oct 2016 15:41:37 GMT

As CGID states: an $84 dollar collection doesn't count on FICO 8 (<$100 "nuisance" collection).

It unfortunately does on FICO 04 and earlier, EX score used for mortgages is FICO 98 (as in 1998) and it absolutely counts there and that will cause a non-trivial score disparity if that is your only collection / public record style mark. Google for HIPAA process for one method of trying to resolve the medical collection at least, post over in Rebuilding Your Credit potentially for others.

Re: Exp 08 went up , mortgage went down

Anonymous — Sat, 22 Oct 2016 15:52:09 GMT

You wanted to know all possible strategies for raising your score, which is the reason I asked about your installment loans. If you were to pay them down a bit you could get some benefit, though it might be mostly on the EX mortgage score rather than the TU and EQ. This is because the mortgage model for TU and EQ is FICO 04, which does not reward a person much (if at all) for keeping loans open but also making sure that you have paid them down a lot. The mortgage model for EX is FICO 98, which does reward you for doing that.(as does FICO 8).

If it had been financially very easy to pay down each loan to a little under 80% (or possible 70%) then we might have explored that. But my guess is that the smarter mortgage decision for you (given where your loans are) is to save all available money between now and closing for your down payment -- and to rely on other strategies for raising your score.

So bottom line for installment loans: keep making regular on time payments. But don't do anything else.

You ask:

"I get the collection holding it down, but do not get how a 30 put jump in one version =a loss of pets in another."

If I understood your initial post right, and your supplemental posts afterward, that collection has been on your reports (and listed as paid) for a long time. Therefore the collection cannot be the cause of a recent point gain in EX FICO 8 vs. a recent point loss in EX mortgage (FICO 98). The collection isn't EQUALLING (i.e. causing) the 30 point rise in one vs. the loss in the other.

I can't be sure what caused one score to go up and one to go down. As I understand it, FICO 98 (your EX mortgage score) is supposed to react in a similar way to FICO 8 with respect to loans being paid off. So my guess would have been that both models would have taken a dive. There may have been other things going on at the same time that could have caused it.

For example, if the collection was listed as paid around that time then FICO 8 would have loved that and would have given you a big boost, one that would have more than compensated for the FICO 8 penalty for the loan payoff. (THus you would have seen a net gain.)

Anyway, the key practical steps for you to take are clear. You cannot undo the step of the loan payoff, so forget about it. Steps for you:

(1) Wait 4-5 months for the collection to go away. You mention EE (by which you may mean Early Exclusion). I don't know anything about that but there are many threads here on the Forum that deal with it. Waiting seems simpler but the key idea is getting the collection to go away. You will get a big boost when this happens.

(2) Then pull all three mortgage scores at myFICO. You will know how eligible you are for loans, best rates, etc. once you do that.

Note: crucial question. In the entire thread you keep talking about your EX mortgage score. Are you also considering what your mortgage scores at EQ and TU might be? If not, why?

If you want some additional advice that is slightly more complicated, here's one more thing you could do to prep for your mortgage. The underwriter will use a piece of software called DU (Desktop Underwriter) to do the final approval your loan. DU will look largely at your FICO mortgage scores, but in the latest version of DU, it also looks to see whether, in the past, you have been what is called a Transactor on your credit cards. A Transactor is a person who does two things:

(a) He transacts. That means his credit reports show that he has actually placed transactions on his cards.

(b) He pays his CC statement in full. This means that he pays that "Amount Owed" that is on the statement sometime in the 21 days following the statement printing. And he pays that in full.

The DU software will be able to see whether you have actually (a) transacted and (b) paid in full for each of the last 24 months.

Thus, if some of your cards haven't been used for a while, it couldn't hurt to create for yourself a history of being a transactor on them. Just for a few months, while you are waiting for the collection to come off. Use the card, let it produce a statement with a positive balance on it, then pay it in full. When the collection falls off, you can go back to your current credit card strategy, which is All Zero Except One (AZEO). AZEO is good for maximizing your FICO mortgage score. Showing that your were a transactor in the past is something that will make DU happy. As long as you have created some history for yourself as a transactor, AZEO can be the strategy you use each month closer to the mortgage. Now is the time to create that history since you still have a good four months of a lousy score due to the collection.

This whole DU/Transactor thing is something you can ignore if you don't understand it. It's more of something you can do just to cover all your bases.

Re: Exp 08 went up , mortgage went down

Sbrooks1 — Sat, 22 Oct 2016 17:30:07 GMT

Thanks for the awesome post! I do know what my other two mortgage scores are as I can't help but buy a new 3 b every month to get an update. The reason this post was focused on exp is because it's the only bureau for me that has fico 8 and 98 going different directions. For the other ladies I find if 08 goes up so does 04, though by a lot less and vice versa! I think I will try the trans actor on my other three cards for the next three month and the. Go back to the AZEO method!! I traded in a much more expensive car and lowered my note from 563 to 302 was willing to accept a few lost points to improve DTI 6 months before apply for mortgage.

Re: Exp 08 went up , mortgage went down

Thomas_Thumb — Sat, 22 Oct 2016 20:57:24 GMT

@Sbrooks1 wrote:
Thanks for the awesome post! I do know what my other two mortgage scores are as I can't help but buy a new 3 b every month to get an update. The reason this post was focused on exp is because it's the only bureau for me that has fico 8 and 98 going different directions. For the other ladies I find if 08 goes up so does 04, though by a lot less and vice versa! I think I will try the trans actor on my other three cards for the next three month and the. Go back to the AZEO method!! I traded in a much more expensive car and lowered my note from 563 to 302 was willing to accept a few lost points to improve DTI 6 months before apply for mortgage.

Interesting. I don't think it is an Experian thing; more like a Fico 04 vs Fico 98 algorithm difference. [when you get another 3B take a look at EX Fico score 3 (a Fico 04 model score) vs EX Fico score 2 (a Fico 98 model score).

I have not read all the above posts but a couple differences between Fico 04 and Fico 98 are:

1) Fico 98 looks at balance/(high balance) on NPSL charge cards - like AMEX as a scoring factor. Fico 04 and Fico 08 do not.

2) Fico 04 does not look at open installment loan balance to loan ratio (B/L) as a scoring factor. Fico 98 does look at open installment loans and their aggregate B/L. If the B/L is high this could be hurting your EX Fico 98 score; if low it might help score. [what is your current installment loan aggregate B/L?]

Re: Exp 08 went up , mortgage went down

Sbrooks1 — Sat, 22 Oct 2016 19:21:36 GMT

The open installment balances definitely hurting me in exp! It may be one of the others become my mid score!