topic Re: Fico dropped suddenly, need help. in Understanding FICO® Scoring

Fico dropped suddenly, need help.

Howaboutthat — Tue, 07 Nov 2017 20:43:34 GMT

CCT alerted me that my Fico dropped 32 points on October 25 from 652 to 620 (Ex), my Tu all dropped from 648 to 631 not sure about Equifax yet but I'll get a new 3b from CCT in two days. The only changes were I got Citi AAdvantage ($3000.00 and a cli from Amex $500.00). Nothing has changed in my reports, everything is paid as agrees and 1late 26 months ago. My utility is 48% down from 52% due to the new card. I'm thinking I should order paper reports and really start researching (Are paper reports more thorough than CCTs). Any help is appreciated. I've also read it sometimes happens and my scores may recover in a month.

Thanks in advance

Re: Fico dropped suddenly, need help.

DollyLama — Tue, 07 Nov 2017 21:17:00 GMT

Well some of those points could be from hard pull inquires on your bureaus, did you app during this time for any others resulting in a hard pull?

Also you give your overall utilization but what about individual utilization of CCs? Did they raise higher on their utilization.

Have you recently paid off an installment loan that was the only one you had?

I'd wait till you get your report from CCT in 2 days, it will show what is being reported.

Re: Fico dropped suddenly, need help.

Anonymous — Tue, 07 Nov 2017 21:51:05 GMT

I had a similar drop in all 2 reports. I requested for an EE, two of my old charged off account from First Premiere with TU and EX got removed. However, my AAOA also got reduced from 8 years down to 8 months, with my longest being only at 2.1 years right now. As for EQ, I gave up with them. I'm not sure why one of the charged off acout was removed yet the other remaining one got updated, hence 1 30 day late and a 60 day late appeared on my report. That one dropped my EQ score down 29 points. So check to see if there is any changes to your AAOA. Oh I recently got an installment loan added to my report. That drops me around 7 points respectively with each bureau.

Re: Fico dropped suddenly, need help.

Anonymous — Tue, 07 Nov 2017 22:17:31 GMT

8 year AAoA drop to 8 months? That's extreme. You must have had an extremely thin file, to the point of 1-2 accounts total.

OP, if you have very few accounts (thin fine) on your credit report, it's possible that adding a new credit card could definitely impact AAoA adversely and drop your score a good amount. The inquiry and new account could result ina 5-15 point drop or so, but the remaining drop could very well be from the AAoA drop.

Re: Fico dropped suddenly, need help.

Anonymous — Tue, 07 Nov 2017 22:32:55 GMT

@Anonymous wrote:
8 year AAoA drop to 8 months? That's extreme. You must have had an extremely thin file, to the point of 1-2 accounts total.

OP, if you have very few accounts (thin fine) on your credit report, it's possible that adding a new credit card could definitely impact AAoA adversely and drop your score a good amount. The inquiry and new account could result ina 5-15 point drop or so, but the remaining drop could very well be from the AAoA drop.

Actually back then I didn't really care much about credit. I was always a cash using person. Not until about two years ago when my wife and I started thinking about buying a home that's when I got a secured card with Wells Fargo. I didn't seriously look into rebuilding my credit until this past year. Currently I have 17 revolving accounts, 1 installment with Golden 1 which I just opened last month, and one collection from Capital One with PRA. Can't get them to budge for PFD so I'm gonna wait couple more months then contact them again. Planning to pay them off in full anyway, then try GW. If not, I'll just have to ride it out and try EE next year. The collection account is due to come off at the end of 2018. The way I see it is as the drop off date getting near, they should be more willing to negotiate. I'm in no rush yet anyway since I need my other accounts to age.

Re: Fico dropped suddenly, need help.

Anonymous — Wed, 08 Nov 2017 00:05:44 GMT

I see. So at the time of the 8 year to 8 month AAoA drop, how many accounts did you have present on your CR?

Re: Fico dropped suddenly, need help.

Anonymous — Wed, 08 Nov 2017 17:58:39 GMT

I am anticipating a drop on my FICO scores this month, when AMEX reports the Blue Delta they approved me for last Sept. My oldest account was Capital One (closed just this month) 1 year and three mos. AAoA is currently 9 Mos. Prior to the AMEX Delta approval I have two other new revolvers (Discover IT and Amex BCE) both 8 mos. old and 1 Charge card (Amex Green), 7 mos. I was wondering if anyone would have an estimate on how much drop in scores would I be looking at. And would my AAoA be reduced to 6 mos. or even less than that?

Re: Fico dropped suddenly, need help.

Anonymous — Wed, 08 Nov 2017 18:06:11 GMT

@Anonymous wrote:
I am anticipating a drop on my FICO scores this month, when AMEX reports the Blue Delta they approved me for last Sept. My oldest account was Capital One (closed just this month) 1 year and three mos. AAoA is currently 9 Mos. Prior to the AMEX Delta approval I have two other new revolvers (Discover IT and Amex BCE) both 8 mos. old and 1 Charge card (Amex Green), 7 mos. I was wondering if anyone would have an estimate on how much drop in scores would I be looking at. And would my AAoA be reduced to 6 mos. or even less than that?

In your case, you have no new accounts reporting less than 6 months old, so your current scores are likely outside the "new account penalty". FICO dings you for new accounts that are 0-3 months old (the most new account penalty) and for 3-6 months old (less new account penalty). It's a small portion of your score, but it's there.

FICO also dings you for an AAoA drop below 24 months or below 6 months, I believe. In your case, your AAoA is 10 months and the new account will bring it down to 9 months when it finally reports after 2 statement cuts. So your AAoA has no changed -- didn't go below 6 months, and was never about 24 months, so no change there.

You may gain a few points if aggregate utilization is over 8.9% and goes lower than that.

I wouldn't be surprised if you were dinged about 2% of your available FICO points (550) or maybe up to 11 points or so for up to 3 months and then it'll decrease from there. That's my guess, but not knowing your FICO8s right now, I can only just guess. Note that FICO themselves say that "new credit" accounts for up to 10% of a score (55 points) but that also includes such things as inquiries. If you are at 0 inquiries and all accounts are older than 6 months, you should get all 55 points back. Inquiries up to 6/7 seem to cost you up to 30-40 points or so total, so the remaining 15-20 points are probably for having a new account on your profile.

Re: Fico dropped suddenly, need help.

Anonymous — Wed, 08 Nov 2017 18:11:19 GMT

@Anonymous wrote:
@Anonymous wrote:
I am anticipating a drop on my FICO scores this month, when AMEX reports the Blue Delta they approved me for last Sept. My oldest account was Capital One (closed just this month) 1 year and three mos. AAoA is currently 9 Mos. Prior to the AMEX Delta approval I have two other new revolvers (Discover IT and Amex BCE) both 8 mos. old and 1 Charge card (Amex Green), 7 mos. I was wondering if anyone would have an estimate on how much drop in scores would I be looking at. And would my AAoA be reduced to 6 mos. or even less than that?
In your case, you have no new accounts reporting less than 6 months old, so your current scores are likely outside the "new account penalty". FICO dings you for new accounts that are 0-3 months old (the most new account penalty) and for 3-6 months old (less new account penalty). It's a small portion of your score, but it's there.

FICO also dings you for an AAoA drop below 24 months or below 6 months, I believe. In your case, your AAoA is 10 months and the new account will bring it down to 9 months when it finally reports after 2 statement cuts. So your AAoA has no changed -- didn't go below 6 months, and was never about 24 months, so no change there.

You may gain a few points if aggregate utilization is over 8.9% and goes lower than that.

I wouldn't be surprised if you were dinged about 2% of your available FICO points (550) or maybe up to 11 points or so for up to 3 months and then it'll decrease from there. That's my guess, but not knowing your FICO8s right now, I can only just guess. Note that FICO themselves say that "new credit" accounts for up to 10% of a score (55 points) but that also includes such things as inquiries. If you are at 0 inquiries and all accounts are older than 6 months, you should get all 55 points back. Inquiries up to 6/7 seem to cost you up to 30-40 points or so total, so the remaining 15-20 points are probably for having a new account on your profile.

Thanks ABC, my current scores are:

EX: 734, Inquiries within the last 12 mos. 3

TU: 742, Inquiries within the last 12 mos. 1

EQ: 732, Inquries within the last 12 mos. 3

Re: Fico dropped suddenly, need help.

Anonymous — Wed, 08 Nov 2017 18:38:03 GMT

You're right there on the edge of "very good" and "good" so you may see a bit more of a punch than someone in the 600s. Would you mind sharing what your alert score changes are when the account finally shows up? I'm working on this JPG of FICO scoring and every data point I get helps to tune it a little bit more!

Re: Fico dropped suddenly, need help.

Anonymous — Wed, 08 Nov 2017 18:50:02 GMT

@Anonymous wrote:
You're right there on the edge of "very good" and "good" so you may see a bit more of a punch than someone in the 600s. Would you mind sharing what your alert score changes are when the account finally shows up? I'm working on this JPG of FICO scoring and every data point I get helps to tune it a little bit more!

I will definitely. The new AMEX card statement cuts on the 10th of this month, Experian reports quicker than the other two so I will update this thread with the before and after FICO score once this new account gets reported.

Re: Fico dropped suddenly, need help.

Anonymous — Wed, 08 Nov 2017 18:50:37 GMT

That would be awesome! I believe Amex typically doesn't report the first statement but does report the second one so hopefully your profile doesn't change too much elsewhere (like accidental utilization posting).

I really screwed up my plans for September due to Irma making me go from $5 utilization (1%) reporting to maxed out on 3 cards for that entire month. Had really good data to pull, oops.

The "new account penalty" is one of the least researched portions in my digging around -- few people actually hold off on apping for 6 months to clear out their old "new account penalty" so it's really tough to find data points!

Re: Fico dropped suddenly, need help.

Anonymous — Wed, 08 Nov 2017 19:23:00 GMT

@Anonymous wrote:
That would be awesome! I believe Amex typically doesn't report the first statement but does report the second one so hopefully your profile doesn't change too much elsewhere (like accidental utilization posting).

I really screwed up my plans for September due to Irma making me go from $5 utilization (1%) reporting to maxed out on 3 cards for that entire month. Had really good data to pull, oops.

The "new account penalty" is one of the least researched portions in my digging around -- few people actually hold off on apping for 6 months to clear out their old "new account penalty" so it's really tough to find data points!

It's really informative, so thank you ABC for sharing that table, it defintely helps most of us to decide whether it would be wise to apply soon or wait and garden before adding new credit cards. I was lucky that the AMEX approval for the Delta was a SP so I was able to get approved for the account without any additional dings for the HP. It was exactly 6 mos. from when I was originally approved for the BCE and Discover (March 2017). I remember back in April, my scores dipped quite a bit, but it somehow stayed within the 700's for both TU and EQ, it was EX that went down as low as 692 between April - May, and I guess it was because I got dinged for the HP as well as the penalty for the AAoA. Would you know if Charge cards are factored the same way in the FICO scoring model? Because when I look at my reports, it seems to look at the total number of revolvers, excluding the Charge card, eventhough on the overall report, it shows 4 accounts total, when I look at, say my Discover FICO score card, it is only counting my 3 current revolvers. Cap1, Discover and AMEX BCE but not the Green Card

Re: Fico dropped suddenly, need help.

Anonymous — Wed, 08 Nov 2017 20:24:44 GMT

FICO Score 8 ignores charge cards towards utilization scoring per this awesome thread: http://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/All-revolvers-zero-testing-HELOC-Amex-charge-PLOC/td-p/4913590

There are other data points but I don't have those threads bookmarked on my phone unfortunately.

I will be getting a Platinum next year to do my own testing tho!

Re: Fico dropped suddenly, need help.

Anonymous — Wed, 08 Nov 2017 21:00:58 GMT

@Anonymous wrote:
FICO Score 8 ignores charge cards towards utilization scoring per this awesome thread: http://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/All-revolvers-zero-testing-HELOC-Amex-charge-PLOC/td-p/4913590

There are other data points but I don't have those threads bookmarked on my phone unfortunately.

I will be getting a Platinum next year to do my own testing tho!

Thank you ABC for the informative read. Amex has become my favorite account, and have spread my expenses on all three cards. They are constantly sending invitations now for the PRG and the Gold Delta but I think I have enough AMEX accounts for my type of spend. The last on my wish list would be a competative Visa Network card which I plan to app for next year. Either BofA or Chase. My goal is to get a second CLI on the BCE to bring it up to at least 5K and the same with the Discover card. So that I would get a more competative SL.

Re: Fico dropped suddenly, need help.

Anonymous — Wed, 08 Nov 2017 21:13:23 GMT

A great Visa card is on my list as well! I'm already in love with my BCP because every time I hit $25 at the grocery store I can smell $1.50 banking for the future. And where I live, sales tax is 10.25% on non-grocery items so that 6% is basically reducing my sales tax rate there, too. The Platinum in the future will be helpful, but not sure HOW helpful.

Re: Fico dropped suddenly, need help.

Anonymous — Wed, 08 Nov 2017 21:42:48 GMT

@Anonymous wrote:
A great Visa card is on my list as well! I'm already in love with my BCP because every time I hit $25 at the grocery store I can smell $1.50 banking for the future. And where I live, sales tax is 10.25% on non-grocery items so that 6% is basically reducing my sales tax rate there, too. The Platinum in the future will be helpful, but not sure HOW helpful.

I do love the AMEX BCE, but i'm sure no cards can currently compete with the 6% cashback on the AMEX BCP. As for rewards points, I would sometimes check when I log into my AMEX account for existing offers that would let me earn more MR points, they currently have AMAZON Prime membership offering additional 5,000points and 2,000 points if you order anything above $50, which is currently competing with Discover's quarterly spend category. So if you want to save up for some future travel plans, I'd say the Platinum would be a great addition for your profile. I don't think I'll ever travel that much to justify that annual fee so I'll stick to the Delta and the Green. I may come back to CapOne for the Venture once my profile supports it, if they are still considered a Visa Signature card. Otherwise, I may just go for the BofA Cashback rewards in Spring next year.

Re: Fico dropped suddenly, need help.

Howaboutthat — Thu, 09 Nov 2017 15:01:57 GMT

I think I figured my problem out, an old account dropped of my report which dropped my AAOA.

This only happened on EX

Experian Today

Oldest Account
5.2 year(s)

Average Account Age
1.7 year(s)

October 24,2017

Oldest Account
23.2 year(s)

Average Account Age
2.8 year(s)

Re: Fico dropped suddenly, need help.

Anonymous — Thu, 09 Nov 2017 15:11:39 GMT

Wow that's painful!

You went from the best age scorecard (20+ years) to the 4th age scorecard (5-10 years) -- not surprised you lost so many FICO points!

I don't have much math or data points on it but it seems each age scorecard gives you 10 points more in ceiling/max score. So going from #1 to #4...30 point drop?

Re: Fico dropped suddenly, need help.

Anonymous — Thu, 09 Nov 2017 15:38:28 GMT

ABCD, are those AoOA ranges that you provide in your chart concrete (actual) values, or are you just sort of shooting from the hip and estimating? Same thing with AoYA, are those ranges estimates? My AoYA crossing the 6 month mark had zero impact on any of my FICO 08 scores.

Perhaps something should be included about AAoA? While it isn't used in score card assignment, it's a big factor and one that maxes out I believe at 7 years and 8 months (max points).