topic Re: What is the picture of a FICO in the vicinity 0f 785 in Understanding FICO® Scoring

What is the picture of a FICO in the vicinity 0f 785

Anonymous — Sat, 03 Mar 2018 00:12:00 GMT

Hello,

I am currently in the rebuilding process and and I am in the mid 600's. I am finally becoming educated and I definitely have this site to thank for the assist. It has now become a goal of mine as I noticed other contributors post their starting scores and their goals. Could anyone glean some insight into what it takes to have a score in the high 700's. Thanks for all your contributions.

Re: What is the picture of a FICO in the vicinity 0f 785

Anonymous — Sat, 03 Mar 2018 02:30:50 GMT

Can't speak from the rebuilding standpoint, but for me, I have 100% on time payment, no derogs, and low UTE. My dings are for lower AAoA (4 years) and number of inquiries. Good luck on your rebuild.

Re: What is the picture of a FICO in the vicinity 0f 785

arkane — Sat, 03 Mar 2018 03:30:53 GMT

I had 780+ across the board when my one and only tradeline back then with 100% payment history hit an age of 23 months. Util was about 3% I think, but definitely under 10%.

So I'd say once any derogs (if present) fall off, focus on building a good payment history and keeping util low. Beyond that, the only thing that will move the needle is time.

Re: What is the picture of a FICO in the vicinity 0f 785

Anonymous — Sat, 03 Mar 2018 03:49:02 GMT

Thanks for the information it will be very useful.

Re: What is the picture of a FICO in the vicinity 0f 785

Anonymous — Sat, 03 Mar 2018 03:56:59 GMT

since I have low credit limits but I charge 40 percent of the credit line and pay it in full before the due date is that the same as having low util rates. I read that it doesnt matter if you pay it off before due date it will show on your report at 40 percent util? that does not make sense to me. If im using it responsible then what is the card for. A 500 limit with 10 util rate i can charge gas a couple of times a month and that's it . As it it seems or I am not understanding thsi correctly.

Re: What is the picture of a FICO in the vicinity 0f 785

DollyLama — Sat, 03 Mar 2018 04:24:16 GMT

@Anonymouswrote:
since I have low credit limits but I charge 40 percent of the credit line and pay it in full before the due date is that the same as having low util rates. I read that it doesnt matter if you pay it off before due date it will show on your report at 40 percent util? that does not make sense to me. If im using it responsible then what is the card for. A 500 limit with 10 util rate i can charge gas a couple of times a month and that's it . As it it seems or I am not understanding thsi correctly.

You go by date of statement cut. Example, my Discover due date is the 28th of the month, my statement cuts the 2nd of the month. The balance as of statement cut is what gets reported to the bureaus. You can charge up to your limit and maintain low utilization by doing this if need be. Example $1k credit line. Have cellphone bill charge and groceries week 1 total $434.00, day 8 - I pay in full $434.00. days 9-15, gas, groceries, Netflix, subscription total $283.00, day 16 or so, I can pay in full $ 283.00, etc. day 23-$43.00 gas. Wait for statement cut. I have a balance of $43.00/$1000 report a balance, I'm under 8.9% utilization, but I've charged $760 on the card. Basically if you use your card as like debit, and pay all but very low balance (if this is your AZEO card), all reporting zero balances except one, you will be just fine.

ETA: As long as you don't charge over limit, you don't need to make 2-3 payments a month, the importance is by the statement date so my statement cuts today the 2nd, my due date is not till March 28th. I will pay it in full now as to not pay interest, charge on it the remainder of month, and make sure my balance is down low by due date and wait till statement cuts again.

Re: What is the picture of a FICO in the vicinity 0f 785

Anonymous — Sat, 03 Mar 2018 04:32:35 GMT

Due Date doesn't have any bearing on your reported utilization Statement date does.

Your credit card puts out a statement once a month, on roughly the same day (give or take a couple). Let's suppose that you have a card that prints its statement on about the 3rd of the month. Just before the statement prints, the CC issuer will look at your current balance and then add to that any interest or fees. That number is the amount you owe. It is also the amount that the CC issuer will report to the three credit bureaus (also on the 3rd).

You then have about 25 days to make at least the minimum payment. That date (the 28th) is the due date. If you pay the amount that was on the statement in full by the due date, then you don't get charged interest.

But since utilization has to do with the number that gets reported to the three bureaus, the due date is not the relevant date, but the date of the next statement.

EXAMPLE:

You have a credit card with a $1000 limit. On March 3 the statement prints and it says that you owe $387. The CC issuer reports that to the three bureaus and your utilization on that card is 38.7%.

You have until March 28 (typically) to make at least the minimum payment. Let's suppose you pay the statement in full, which would be a payment of $387. You now owe no interest. But assuming you made some more charges in March, your new balance on April 3 could be as little as $5 or as high as $759. Thus "paying in full" (paying the full amount on the statement) doesn't have anything to do with what number gets reported to the three bureaus the next month.

You can control what that number is easily, however, by paying your balance down to whatever number you want reported shortly before the next statement prints.

Re: What is the picture of a FICO in the vicinity 0f 785

Anonymous — Sat, 03 Mar 2018 12:19:28 GMT

Thank you all for the explanation and the specific examples. I thought I understood financial terms and thoeries fairly well, but this credit score situation is on a whole different level. When one employs AZEO method, is it accpetable to just have the other cards sit in yoiur wallet and never really get used. I read that especially when building credit with credit cards the cards should be active somewhat to show you can use credit. Thanks to everyone the helped with comments .

Re: What is the picture of a FICO in the vicinity 0f 785

HeavenOhio — Sat, 03 Mar 2018 13:09:23 GMT

You can deploy AZEO by not using some of your cards, but keep in mind that they should be used here and there to keep them active. Or, if you wish, you can use these cards a lot and still have them report zero to the bureaus. Simply pay them down to zero before they report and make sure that no pending charges post in the meantime.

That said, it's probably a good idea to give most of your cards a turn at reporting a positive balance once in a while. While most cards report a "date of last payment" each month, I've noticed that AMEX doesn't. That means that lenders can usually tell that a card's been used recently even if it's been reporting zero. But that isn't always the case.

It should also be noted that while most cards report the statement balance on or just after the statement date, there are some exceptions. The most notable are US Bank and Chase. US Bank reports on the first of the month. Chase reports the statement balance on the statement date like most cards, but it'll also report zero whenever you pay to zero.

Re: What is the picture of a FICO in the vicinity 0f 785

DollyLama — Sat, 03 Mar 2018 13:21:50 GMT

Best to have usage, but can let it sit a month or two, going too long several months, can ding a few points from a card deemed inactive to active. Best if you can build up to decent cards that work for you, rather cashback, travel rewards or cash rewards. If it must be a store card that you have in your wallet, make it one you frequent often. ie Amazon, Macy's, etc. Kind of hard if you get a specific card like Victoria's secret, Pier One, etc.

Re: What is the picture of a FICO in the vicinity 0f 785

HeavenOhio — Sat, 03 Mar 2018 14:00:57 GMT

@DollyLama, is there a way to tell from looking at your report that a card has "officially" become inactive?

I have two cards that haven't reported a positive balance in over a year. But they get used each month, and they both report a current date of last payment. I wonder what FICO considers their status to be.

Re: What is the picture of a FICO in the vicinity 0f 785

DollyLama — Sat, 03 Mar 2018 14:16:33 GMT

No they don't state inactive on reports, nor any alerts that has become inactive,, and I do not get alerts on my Cap 1 that I use during the month, but report 0 balance.So it is deemed active. Although I did on a card I used in November for Christmas, and then again February, that alert on Feb. stated inactive to active. So as long as you use the card regardless if PIF, that perceive it as active. Same thing happened on a DIY store card I used over the summer and PIF by statement date, got dinged a few points.

Re: What is the picture of a FICO in the vicinity 0f 785

Anonymous — Sat, 03 Mar 2018 14:57:33 GMT

Good information tks so much. I understand everything you wrote. However, I am inquiring about a situation such as this. Let's say you have 3 cards. You want to employ the AZEO strategy, you only use 1 card and keep the utilization rate below 10 percent. If u do not use lets say 1 or both of the other cards, will that be a problem. Will the creditor deactivate the card? Does it lower your score? I suppose my real question is do you have to at least occsionally use the other 2 cards when employing the AZEO method? It's not difficult to do, but I read that a contributor stated that his creditor had some sort of problem with the fact that he didn't use one of his cards( may have misread that statement therefore looking for clarification). Sorry if this questioned was already answered and thanks for all the information.

Re: What is the picture of a FICO in the vicinity 0f 785

Anonymous — Sat, 03 Mar 2018 15:15:45 GMT

In my opinion, you can solve all of your concerns by (gasp) not implementing AZEO. Just use your cards naturally and put them on autopay. If it so happens that a particular card was simply not used for 2, 3, 4 months in a row, then fine. You will have a short string of zero balances reported. If it so happened that you had a real need to use each card for a number of months, then you will have a short string of months in which all cards are showing a balance.

AZEO only comes into its own when you are trying to squeeze out every additional scoring point, typically in the 40 days before an important application for credit. Even then the benefit is only really striking for the mortgage scores. FICO 8 by comparison doesn't care as much whether you have several small balances reporting or exactly one.

With the "natural use" approach, of course, you will still want to make sure your total utilization stays reasonably low: less than 29% every month and less than 9% at least some months.

Re: What is the picture of a FICO in the vicinity 0f 785

909 — Sat, 03 Mar 2018 15:30:45 GMT

I just had alerts for two AMEX cards going from inactive for 8 months to active. I use them multiple times every month but pay to zero before the statement date except for this last date, i.e. usage doesn’t equate activity if AMEX doesn’t report usage because the balance on the statement date is always zero.

Re: What is the picture of a FICO in the vicinity 0f 785

Anonymous — Sat, 03 Mar 2018 15:30:09 GMT

Thank you all for the information. All these new concepts can get confusing. I appreciate all the comments and advice. I will use the cards regularly without any specific strategy as long as I keep the util rate below 10 perecent. One last question please, for anyone willing to give it a go. I got first my card and used it around 50 percent and I'm sure it got reported at a 50 percent util rate but that was the first month and I paid it in full. I did not know that the closing date was was literally weeks away from the due date and was not knowledgeable about the closing date's significance. Will that months util rate follow me around for months or years. Do they look at a month with a high util rate and ding you for it even if it was once and it was months down the road (prospective new creditors).

Re: What is the picture of a FICO in the vicinity 0f 785

DollyLama — Sat, 03 Mar 2018 15:30:27 GMT

Yes a creditor will after sometime maybe a year? of no use can just close your account. This will still stay on your report for 10 years but eventually age off, the drawback is if you had a decent size credit limit, it no longer is factored in utilization. Say card 1 has $1000 CL, card 2 $700, card 3 $1000 , total is 2700, you never used card 3 and creditor closes account, now you are at total credit line of $1700. So yes, I would take a ding of 5 or 6 pts if need be to keep the account open every 4-6 months and you can till employ AZEO with the card of your choosing. It will give me a longer credit history the more years it remains open. The only time I would recommend not caring if creditor closes your account, or you decide to close the account, is if it is not your oldest card you have opened by several years, and has some type of annual fee often subprimes $99 yrly with a credit line that never raises.

I have one now that is sock drawered, haven't used in over 9 months, may let it just close out, it is not my oldest card, doesn't give me any perks other than a charge, and not a company that gives credit line increases without a hard pull inquiry. I've also gained credit line increases with cards with perks, cashback, that really makes this card obsolete for me right now.

Re: What is the picture of a FICO in the vicinity 0f 785

Anonymous — Sat, 03 Mar 2018 15:41:55 GMT

@Anonymouswrote:
Thank you all for the information. All these new concepts can get confusing. I appreciate all the comments and advice. I will use the cards regularly without any specific strategy as long as I keep the util rate below 10 perecent. One last question please, for anyone willing to give it a go. I got first my card and used it around 50 percent and I'm sure it got reported at a 50 percent util rate but that was the first month and I paid it in full. I did not know that the closing date was was literally weeks away from the due date and was not knowledgeable about the closing date's significance. Will that months util rate follow me around for months or years. Do they look at a month with a high util rate and ding you for it even if it was once and it was months down the road (prospective new creditors).

No. Utilization has no memory in all current and past FICO models. So, for example, you could have a really high utilization for three months in a row (85% say on all cards), but if you then paid almost all your CC debt off it would be (from FICO's perspective) as if your cards had always had a low utilization.

There are still many good reasons to avoid ultra-high utilizations -- e.g. some CC issuers will get spooked by that and close your card or take other adverse action. But long term score impact is not one of them.

Re: What is the picture of a FICO in the vicinity 0f 785

HeavenOhio — Sat, 03 Mar 2018 17:42:42 GMT

@909wrote:
I just had alerts for two AMEX cards going from inactive for 8 months to active. I use them multiple times every month but pay to zero before the statement date except for this last date, i.e. usage doesn’t equate activity if AMEX doesn’t report usage because the balance on the statement date is always zero.

I've let my AMEX card report zero for two consecutive months, which is something I've never done before. I wonder if that's enough to make the card inactive.

Re: What is the picture of a FICO in the vicinity 0f 785

Anonymous — Sat, 03 Mar 2018 17:46:12 GMT

what if any are the consequences of a card reporting inactive on credit reports? Will this adversely affect scores?