topic Re: What would cause a 60 point drop in 1 month? in Understanding FICO® Scoring

What would cause a 60 point drop in 1 month?

Anonymous — Wed, 01 Feb 2017 17:22:58 GMT

The facts:

I have 3 derogs TL's (Charge Offs) all within 6 months of aging off. Aggregate balance approx $100K; I have two new positive TL's - a Secured credit card with a $200 line and 0% utilization and an auto loan that is on auto-pay so delinquency on either is not a factor. No credit use in between the crash 7 years ago and teh re-start 7 months ago.

In December 2016 one Charge Off aged off my credit file. The following month I lost 60 points.

Can anyone explain to me what happened? It seems whenever something that SHOULD improve my credit score happens, I lose points. When I paid off my mortgage in April 2016 I lost 40 points. At this rate in July I will have a credit file that shows 1 unused credit card with a low limit, 3 paid satis car loans, a paid satis mortgage, no derogatives and a score in the solid 400's. No mortgage, no debt, plenty of income, a 6-figure bank balance and I can't get credit to buy a pack of gum.

Re: What would cause a 60 point drop in 1 month?

Anonymous — Wed, 01 Feb 2017 18:55:21 GMT

A 60 point drop is very significant and something that is usually only achieved by the introduction of a negative item. I suppose it could be achieved as well in going from 1% aggregate utilization to maxed-out utilization on some profiles, but certainly you would know if you did this

I would look closely at your reports and see what changed between last month and this month. Something negative was definitely added. Maybe a past negative item that fell off was re-reported or somehow resurfaced. Is it possible that one of your current accounts may have reported you late?

Slightly off topic here, but the 40 point drop you received from paying off your mortgage is very typical when the mortgage is your only installment loan. Once all current loans are closed out, FICO takes away the "credit mix" points that you previously had for having a current open installment loan that's almost paid off.

Re: What would cause a 60 point drop in 1 month?

Anonymous — Wed, 01 Feb 2017 19:01:37 GMT

I mhave been watching my credit files like a hawk the past year - one Charge Off aged off in December 2016, that is the only change, and that happened the month before I lost the 60 points. I would think that losing a Charge Off would be a GOOD thing, not a bad one. The other two report every month like clockwork (and PLEASE, PLEASE, PLEASE report in July 2017 because I will have a FDCPA/FCRA suit in their hands so fast they will not see it coming).

Re: What would cause a 60 point drop in 1 month?

stellar — Wed, 01 Feb 2017 21:34:05 GMT

Sometimes losing a bad account drops your AAoA.

Where are you getting your scores from? If it's from creditkarma, you can disregard the scores, they are FAKO.

Re: What would cause a 60 point drop in 1 month?

Anonymous — Wed, 01 Feb 2017 21:41:55 GMT

Credit Karma, Capital One, Credit Sesame and Trans Union itself all score within 1 point of each other, so while the number itself may be questionable, it's general level and accuracy of scoring is pretty reliable.

Re: What would cause a 60 point drop in 1 month?

Anonymous — Wed, 01 Feb 2017 21:57:36 GMT

One other factor that we don't hear much of is rebucketing as it relates to FICO Scores. It has been so long since anything has been mentioned on this site I forgot more than I remember. Don't know that re-bucketing would hit so hard it would decrease 60 points. Since you have several different scores it is likely accurate but why ... understand that is the question?

Re: What would cause a 60 point drop in 1 month?

Anonymous — Wed, 01 Feb 2017 22:07:52 GMT

@Anonymous wrote:
Credit Karma, Capital One, Credit Sesame and Trans Union itself all score within 1 point of each other, so while the number itself may be questionable, it's general level and accuracy of scoring is pretty reliable.

CK, CO and SC all provide a VantageScore 3.0 score from TU. Those are not FICO scores.

I suggest going to Credit Check Total and for $1 you can get all 3 of your FICO 08 scores. Perhaps whatever the 60 point issue is happens to be something that doesn't impact the FICO models but does on VS 3.0. Who knows. That would be a start, though.

Re: What would cause a 60 point drop in 1 month?

Anonymous — Wed, 01 Feb 2017 22:09:00 GMT

@stellar wrote:
Sometimes losing a bad account drops your AAoA.

While this is can definitely be true, there's no realistic way that an AAoA drop would result in a 60 point FICO score drop.

Re: What would cause a 60 point drop in 1 month?

heavyjay — Wed, 01 Feb 2017 22:20:53 GMT

@Anonymous wrote:
The facts:

I have 3 derogs TL's (Charge Offs) all within 6 months of aging off. Aggregate balance approx $100K; I have two new positive TL's - a Secured credit card with a $200 line and 0% utilization and an auto loan that is on auto-pay so delinquency on either is not a factor. No credit use in between the crash 7 years ago and teh re-start 7 months ago.

In December 2016 one Charge Off aged off my credit file. The following month I lost 60 points.

Can anyone explain to me what happened? It seems whenever something that SHOULD improve my credit score happens, I lose points. When I paid off my mortgage in April 2016 I lost 40 points. At this rate in July I will have a credit file that shows 1 unused credit card with a low limit, 3 paid satis car loans, a paid satis mortgage, no derogatives and a score in the solid 400's. No mortgage, no debt, plenty of income, a 6-figure bank balance and I can't get credit to buy a pack of gum.

Hi Steve,

Credit Karma, Capital One, Credit Sesame and Trans Union all give you your Vantage score. Few, if any, lenders use this scoring model. FICO uses the Average Age of Accounts as one of its scoring parameters. It includes both open and closed accounts.

The Vantage model uses Average Age of Open Accounts and also gives it way too much weight. The Vantage model isn't factoring in the ages of your paid mortgage or auto loans.

Six months from now, when those 3 derogs are gone and your secured card and car loan have some more age on them, you'll get a nice score bump.

BTW, you need 2 more revolving accounts. Best scores are attained when you have at least 3.

Re: What would cause a 60 point drop in 1 month?

Thomas_Thumb — Wed, 01 Feb 2017 22:55:36 GMT

@heavyjay wrote:
@Anonymous wrote:
The facts:

I have 3 derogs TL's (Charge Offs) all within 6 months of aging off. Aggregate balance approx $100K; I have two new positive TL's - a Secured credit card with a $200 line and 0% utilization and an auto loan that is on auto-pay so delinquency on either is not a factor. No credit use in between the crash 7 years ago and teh re-start 7 months ago.

In December 2016 one Charge Off aged off my credit file. The following month I lost 60 points.

Can anyone explain to me what happened? It seems whenever something that SHOULD improve my credit score happens, I lose points. When I paid off my mortgage in April 2016 I lost 40 points. At this rate in July I will have a credit file that shows 1 unused credit card with a low limit, 3 paid satis car loans, a paid satis mortgage, no derogatives and a score in the solid 400's. No mortgage, no debt, plenty of income, a 6-figure bank balance and I can't get credit to buy a pack of gum.
Hi Steve,

Credit Karma, Capital One, Credit Sesame and Trans Union all give you your Vantage score. Few, if any, lenders use this scoring model. FICO uses the Average Age of Accounts as one of its scoring parameters. It includes both open and closed accounts.

The Vantage model uses Average Age of Open Accounts and also gives it way too much weight. The Vantage model isn't factoring in the ages of your paid mortgage or auto loans.

Six months from now, when those 3 derogs are gone and your secured card and car loan have some more age on them, you'll get a nice score bump.

BTW, you need 2 more revolving accounts. Best scores are attained when you have at least 3.

VantageScore 3.0 uses both open and closed accounts. Credit Karma reports VantageScore but, calculated factor summaries (AAoA, utilization) are directly from CK - not VS. Somewhere on the VantageScore website it states they use open + closed - IV provided a link to that previously.

Side note: Credit Karma, Credit.com and Credit Sesame all report VS 3 score. However, some sites show AAoA based on open accounts only while others display AAoA based on open + closed. This is another illustration of differences in 3rd party calculations - that appear to be provided by VS but, are not. The only thing VantageScore provides to these companies are the scores and depending on the relationship, reason statements.

VantageScore does weigh factors quite differently from Fico. For those that don't have access to a free Fico 08 score through a credit card; a free Experian Fico 08 is available by signing up for Discover credit scorecard. You don't need to sign up for one of their credit cards to gain access and the score does not generate a HP.

https://www.discover.com/free-credit-score/

Re: What would cause a 60 point drop in 1 month?

stellar — Wed, 01 Feb 2017 23:08:00 GMT

@Anonymous wrote:
@stellar wrote:
Sometimes losing a bad account drops your AAoA.

While this is can definitely be true, there's no realistic way that an AAoA drop would result in a 60 point FICO score drop.

I never said it would drop his score 60 pts.

Re: What would cause a 60 point drop in 1 month?

heavyjay — Wed, 01 Feb 2017 23:09:10 GMT

Credit Sesame shows my TU credit age at 3 years. Credit Karma shows both my TU and EQ as 3 years 1 month. MyFico shows TU at 6.1 years and EQ at 4.5.

Re: What would cause a 60 point drop in 1 month?

Anonymous — Wed, 01 Feb 2017 23:23:33 GMT

Thanks to all for the insight. I know a lot about collections, FCRA and FDCPA but the inner workings of FICO and the other models are a mystery to me. It seems that Vantage is designed to provide the lowest possible score under all conditions. Pay off a loan satisfactorally and as soon as it is paid off <poof> it is forgpotten by Vantage 3. Miss one payment on that loan and it stays for the full 7.5 years. Vantage 3.0 also seems to ignore Date of Last Payment and Date of First Delinquency on TLs that report every month, like my two Charge Offs. Those two accounts are so old that they age off credit reporting in 4 months (out of the 90 - 7.5 years - that they can be there) but Vantage 3.0 is treating them as brand new because of the recurrent reporting.

As to why all of a sudden I lost the 60 points? That is the mystery. One Charge Off did age off the prior month but if the DOFD or DLP is used it would have had minimal effect because I have at least 5 other TL's just as old.

I am left to believe that credit scopres are simply a ruse perpetrated on us to keep us in line. The old adage of "one aw-sh*t wipes out all attaboys" has never been truer anywhere else but in credit scores. Points lost for any or no reason are not re-earned for many years.

Twenty years ago I had an Identity Theft derog TL put against me on one of the CRA's. As soon as I saw it I contacted the lender and proved that there was no possible way I could have authorized that account and that it was identity theft. The TL was promp[tly removed (under a very credible threat of a very significant lawsuit against the TL originator and the CRA). When the TL went on I lost 45 points. When it came off 3 weeks later I only got back 10 of them. The credit scores therefore work not only with TLs and data that we are allowed to see, but there is stuff in the calculation that is based on what we are NOT allowed to see.

Re: What would cause a 60 point drop in 1 month?

SouthJamaica — Thu, 02 Feb 2017 00:08:55 GMT

@Anonymous wrote:
The facts:

I have 3 derogs TL's (Charge Offs) all within 6 months of aging off. Aggregate balance approx $100K; I have two new positive TL's - a Secured credit card with a $200 line and 0% utilization and an auto loan that is on auto-pay so delinquency on either is not a factor. No credit use in between the crash 7 years ago and teh re-start 7 months ago.

In December 2016 one Charge Off aged off my credit file. The following month I lost 60 points.

Can anyone explain to me what happened? It seems whenever something that SHOULD improve my credit score happens, I lose points. When I paid off my mortgage in April 2016 I lost 40 points. At this rate in July I will have a credit file that shows 1 unused credit card with a low limit, 3 paid satis car loans, a paid satis mortgage, no derogatives and a score in the solid 400's. No mortgage, no debt, plenty of income, a 6-figure bank balance and I can't get credit to buy a pack of gum.

If you would like an answer to the question,

please advise:

1. what scores and what reports are you looking at and where are you getting them from

2. original amount and present balance of any open installment loans

3. credit limit and last reported balance of any open revolving accounts

4. all changes that occurred between last report and current report

With that information we can probably answer your question.

Re: What would cause a 60 point drop in 1 month?

Anonymous — Thu, 02 Feb 2017 00:18:49 GMT

@SouthJamaica wrote:
@Anonymous wrote:
The facts:

I have 3 derogs TL's (Charge Offs) all within 6 months of aging off. Aggregate balance approx $100K; I have two new positive TL's - a Secured credit card with a $200 line and 0% utilization and an auto loan that is on auto-pay so delinquency on either is not a factor. No credit use in between the crash 7 years ago and teh re-start 7 months ago.

In December 2016 one Charge Off aged off my credit file. The following month I lost 60 points.

Can anyone explain to me what happened? It seems whenever something that SHOULD improve my credit score happens, I lose points. When I paid off my mortgage in April 2016 I lost 40 points. At this rate in July I will have a credit file that shows 1 unused credit card with a low limit, 3 paid satis car loans, a paid satis mortgage, no derogatives and a score in the solid 400's. No mortgage, no debt, plenty of income, a 6-figure bank balance and I can't get credit to buy a pack of gum.
If you would like an answer to the question,
please advise:

1. what scores and what reports are you looking at and where are you getting them from

Credit Karma TU - 10/31/16 - 639 11/30/16 - 639 12/31/16 - 581 1/31/2017 - 581
Capital One TU - 10/31/16 - 639 11/30/16 - 641 12/31/16 - 641 1/31/17 - 581
Credit Sesame TU - 10/31/16 - 639 11/30/16 - 639 12/31/16 - 581 1/31/17 - 641 2/1/17 - 582
TU Credit Monitoring - 1/31/17 - 581

2. original amount and present balance of any open installment loans

Only open Installment Loan opened 12/31/15 Start Balance $12,000 Approx Balance 8,700 no late payments

3. credit limit and last reported balance of any open revolving accounts

Only one - Crapital One Limit $240 Balance $0

4. all changes that occurred between last report and current report

None that I can see except a Discover Bank Charge Off aged off in December 2016. I paid off my mortgage in April 2016 and took a 40 point hit for that sin.

With that information we can probably answer your question.

Re: What would cause a 60 point drop in 1 month?

newhis — Thu, 02 Feb 2017 00:34:20 GMT

Please go to freecreditscore.com and open an account, you will get a free EX report/score (FICO) every 30 days.

Then you can see what changes drop/increase your EX FICO.

Don't let your only credit card report $0, let it report $3.

Re: What would cause a 60 point drop in 1 month?

newhis — Thu, 02 Feb 2017 00:43:17 GMT

@Anonymous wrote:
If you would like an answer to the question,
please advise:

1. what scores and what reports are you looking at and where are you getting them from

Credit Karma TU - 10/31/16 - 639 11/30/16 - 639 12/31/16 - 581 1/31/2017 - 581
Capital One TU - 10/31/16 - 639 11/30/16 - 641 12/31/16 - 641 1/31/17 - 581
Credit Sesame TU - 10/31/16 - 639 11/30/16 - 639 12/31/16 - 581 1/31/17 - 641 2/1/17 - 582
TU Credit Monitoring - 1/31/17 - 581

2. original amount and present balance of any open installment loans

Only open Installment Loan opened 12/31/15 Start Balance $12,000 Approx Balance 8,700 no late payments

3. credit limit and last reported balance of any open revolving accounts

Only one - Crapital One Limit $240 Balance $0

4. all changes that occurred between last report and current report

None that I can see except a Discover Bank Charge Off aged off in December 2016. I paid off my mortgage in April 2016 and took a 40 point hit for that sin.

With that information we can probably answer your question.

Do you know that you can go to CK every week and get an update? You can then select your old report TU/EQ and see what changes made your score go up/down.

You need reported data to make sense of your scores. That's why I ask you to open a FCS account to get EX report and score.

Go to CK 11/30/16 report and check all the differences with the 12/31/16 report.

Re: What would cause a 60 point drop in 1 month?

Anonymous — Thu, 02 Feb 2017 00:46:45 GMT

CK may not give me a full report but Crapital One, Credit Sesame and TU itself do. Except for the Discover Card Charge Off aging off and the balance owed on the installment loan decreasing, nothing changed. My other Charge Offs (Midland and Resort Recovery) keep reporting every month like they have done for years but the balance doesn't change.

Re: What would cause a 60 point drop in 1 month?

Anonymous — Thu, 02 Feb 2017 00:50:47 GMT

@ flyingifr, IMHO, investing $30 to pull your true Fico8 scores at MyFico may be money well invested in knowing what's factual regarding your scores and reports. You can always cancel it before it bills for the second month.

The Fakos for me are all a few points a part but some are a huge swing from my actual scores. For example, my Credit Karma TU is showing 653 as of today and my actual TU score is 710. When rebuilding, I consider having real scores just the cost of doing business. I would be losing sleep without the ability to see my actual scores but that's just me.

Congrats on paying off the MTG by the way...super nice!!

Chapter 7: Discharged November 2015
Total Revolving Credit Lines January 2016: $2600
Total Revolving Credit Lines January 2017: $148K
11/15 Fico 8: EQ-585, TU-550, EX- 551
01/17 Fico 8: EQ-695, TU-703, EX-673
Advantis CU Siggy Visa $25K, NFCU Cash Rewards Visa $4600> $22K, NFCU CLOC $15K, NFCU Go Rewards Visa $5,500, PenFed Promise Visa $10,500, PenFed Platinum Rewards Siggy Visa $5500, Redi+ Siggy Visa $5K, SPGVisa $4,500>$5250, Cap One Platinum $2K>$4K, Cap One Quicksilver $3K, Good Sam Visa $1800, Discover $1800>$2K>$2300, Lowe's $6K>$17K, Overstock $7K>$7300>$7700, Evine $1K>$5K, HSN $3750, PenFed Thrifty $500, That's right...Credit One Visa is G-O-N-E!

Re: What would cause a 60 point drop in 1 month?

Anonymous — Thu, 02 Feb 2017 00:58:13 GMT

@stellar wrote:
I never said it would drop his score 60 pts.

You may not have said it, but it was implied. OP writes why did my score drop 60 points and you respond with losing an account can drop your AAoA [which can drop your score]. To me, that suggest to the OP that you believe or would like him to believe that an AAoA change can result in a 60 point drop. I'm simply letting the OP know that certainly is not the case.