topic AZEO Bum Results in Understanding FICO® Scoring

AZEO Bum Results

thornback — Fri, 09 Mar 2018 09:00:35 GMT

So, I finally managed AZEO. I have 3 revolving credit cards (no AU or charge cards) and aggregate util is always around 1-2% with individual util less than 8%.

While implementing AZEO, I watched my scores as I went from two to three cards reporting, back to two cards reporting, and, finally, to one card reporting a balance of $5.

FICO 8 Results (all bureaus):

2 to 3 cards reporting: +/- 0
3 to 2 cards reporting: +/- 0
2 to 1 card reporting: +/- 0

My scores have been stable for the past few months and did not budge with AZEO.

However, AZEO did increase my EX Mortgage / FICO Score 2 (+10) - I do not have access to TU / EQ mortage scores. Too bad that doesn't matter to me as I'm not currently seeking a mortgage.

So, since this method has no affect on my standard FICO profile, I'll just let my cards report normally as I maintain low util. I know I lose points when aggregate meets or exceeds 8.9% and / or individual meets or exceeds 28.9%.

It would have been nice to squeeze out a few extra points tho - eventhough I'm not so sure I would have been willing to maintain AZEO every month to keep them; it just would have been nice to know I had a quick method of increasing my score if necessary. Oh well...

Re: AZEO Bum Results

NRB525 — Fri, 09 Mar 2018 13:31:51 GMT

Sorry to hear your results were disappointing, but your sharing is quite an important contribution.

So many of the comments about AZEO are over-selling the benefits. Newbies hear the word “maximize” and assume it is going to cure all their problems.

AZEO is really just the final representation of your low utilization; you already got the points from low utilization.

From your score levels I am guessing you have a baddie or two. That puts the ceiling on your scores and the scores will rise with time, and continued on-time payments, same as all profiles.

Thanks for sharing and good luck in your journey.

Re: AZEO Bum Results

Anonymous — Fri, 09 Mar 2018 14:06:31 GMT

@NRB525So many of the comments about AZEO are over-selling the benefits.

I agree completely. In the thread that I started 1-2 months back discussing the benefit of 3 cards (with AZEO) in place verses just 1 card, reported gains ranged from 4-12 points, with the average being about 8 points. I think the perceived gain when people are using words like "maximize" as you stated above is much greater than that. It really isn't a dramatic difference.

You also make a very good point about dirty verses clean files. When my file was dirty, like the OP, I could allow 25%, 50%, 75% or 100% of my cards report balances and my score wouldn't budge. The only time it changed was when all cards reported $0. While AZEO may help a bit on a clean file, I'm not sure the minor benefits are really there with a dirty file.

Re: AZEO Bum Results

Anonymous — Fri, 09 Mar 2018 18:20:51 GMT

@Anonymouswrote:
@NRB525So many of the comments about AZEO are over-selling the benefits.
I agree completely. In the thread that I started 1-2 months back discussing the benefit of 3 cards (with AZEO) in place verses just 1 card, reported gains ranged from 4-12 points, with the average being about 8 points. I think the perceived gain when people are using words like "maximize" as you stated above is much greater than that. It really isn't a dramatic difference.

You also make a very good point about dirty verses clean files. When my file was dirty, like the OP, I could allow 25%, 50%, 75% or 100% of my cards report balances and my score wouldn't budge. The only time it changed was when all cards reported $0. While AZEO may help a bit on a clean file, I'm not sure the minor benefits are really there with a dirty file.

It varies from profile to profile how many Points one can get. For most it’s in the 10 to 20 point range when going from $0 on all to one showing a small balance. Dirty or clean file there is benefits. But, going from above 50% or 80% usage and higher it’s a huge improvement. Like 50 to 75 points. It all depends on where one started. The thinner the file the higher the points are generally. One who has a thick file is on the lower end for most. There is always exceptions because no one knows exactly how the formulas work. And things unknown can offset gains in some profiles. There are people who oversell the benefits. And if someone isn’t applying for anything there is no need to do AZERO at every month. Just before one applies for something.

Re: AZEO Bum Results

NRB525 — Fri, 09 Mar 2018 20:03:30 GMT

Well going from nothing repotting a balance to one reporting a balance is a different issue.

Going from high ( over 50% utilization) to lower utilization is just getting points for lower utilization. Taking the last step to AZEO is not where those points were earned.

Re: AZEO Bum Results

Anonymous — Fri, 09 Mar 2018 20:49:27 GMT

@Anonymous
It varies from profile to profile how many Points one can get. For most it’s in the 10 to 20 point range when going from $0 on all to one showing a small balance.

Ben, I agree if we're talking going from all $0 reported balances to AZEO, but we're talking about going from more (2+) with reported balances down to AZEO. That change is almost always IMO going to be good for less points and in some cases may be good for no points.

Re: AZEO Bum Results

thornback — Sat, 10 Mar 2018 01:05:25 GMT

@NRB525wrote:
Sorry to hear your results were disappointing, but your sharing is quite an important contribution.

So many of the comments about AZEO are over-selling the benefits. Newbies hear the word “maximize” and assume it is going to cure all their problems.

AZEO is really just the final representation of your low utilization; you already got the points from low utilization.

From your score levels I am guessing you have a baddie or two. That puts the ceiling on your scores and the scores will rise with time, and continued on-time payments, same as all profiles.

Thanks for sharing and good luck in your journey.

Yes, I have a single derogatory - a 4.8 year old paid charge-off. Aside from the single derog., I also have a very short revolving credit history. My oldest account is 5.1 years old and it's a student loan. My 3 CCs are each only 5 months old - so I'm still being penalized for new credit (which is why I'm gardening till, at least, Jan 2019), but even with that, my scores are above 740+. I am aware that, at this point, only time (or the magical removal of that ugly charge-off) will improve my scores.

This was more of a test run for me to see (1) how my scores respond to number of cards reporting; and (2) if AZEO would positively impact my scores as it has for some others. As I said, I doubt I'd be willing to maintain it on a monthly basis in order to keep whatever point boost received; I just wanted to know if it was a method that would come in handy for me to use in a pre-app crunch. I agree that it is a not an ideal credit management tool and never viewed it as such. Actually, I believe allowing your cards to report responsible use reflects better upon manual review - so I'm kinda happy I don't get penalized for letting all 3 report a balance because I'm generally not a heavy credit user so can get away with simply paying my full balance due before the due date. Rarely do I need to paydown before the statement cuts to control reported util.

Anyways, no harm, no foul. And AZEO does seem to enhance mortgage scores so there's that...

Thanks for reading, responding, your sympathy, and good wishes!!

Re: AZEO Bum Results

thornback — Sat, 10 Mar 2018 02:16:55 GMT

@Anonymouswrote:
@Anonymouswrote:
@NRB525So many of the comments about AZEO are over-selling the benefits.
I agree completely. In the thread that I started 1-2 months back discussing the benefit of 3 cards (with AZEO) in place verses just 1 card, reported gains ranged from 4-12 points, with the average being about 8 points. I think the perceived gain when people are using words like "maximize" as you stated above is much greater than that. It really isn't a dramatic difference.

You also make a very good point about dirty verses clean files. When my file was dirty, like the OP, I could allow 25%, 50%, 75% or 100% of my cards report balances and my score wouldn't budge. The only time it changed was when all cards reported $0. While AZEO may help a bit on a clean file, I'm not sure the minor benefits are really there with a dirty file.
It varies from profile to profile how many Points one can get. For most it’s in the 10 to 20 point range when going from $0 on all to one showing a small balance. Dirty or clean file there is benefits. But, going from above 50% or 80% usage and higher it’s a huge improvement. Like 50 to 75 points. It all depends on where one started. The thinner the file the higher the points are generally. One who has a thick file is on the lower end for most. There is always exceptions because no one knows exactly how the formulas work. And things unknown can offset gains in some profiles. There are people who oversell the benefits. And if someone isn’t applying for anything there is no need to do AZERO at every month. Just before one applies for something.

I agree, but utilization reduction wasn't an issue nor the purpose of implementing AZEO in my case. I just wanted to try it to see if it would positively affect my profile. I'm gardening, so I have nothing better to do but see how my scores respond to various, isolated factors. Now I know for sure that it doesn't matter, for me, how many of cards report a balance - though a prior experiment proved my profile to be very sensitive to utilization.

As for thin vs. thick file -- I'm not sure how mine would be categorized. I have 14 accounts consisting of 11 student loans and 3 CCs (15 total accounts if you count the paid charge-off). My AAoA is 2.8 years and my oldest account is 5.1 years. My revolving credit history is lacking / thin, as all 3 CCs are only 5 months old.

Re: AZEO Bum Results

Hex — Sat, 10 Mar 2018 01:40:46 GMT

I always do AZEO but I need need to report close to 1% or I lose points. If I reported $318 last month and lost 10 points on Equifax. I let a second card report $200 and got the 10 points back. I think reporting only $5 would tank my scores. I have $61K in available credit.

Re: AZEO Bum Results

thornback — Sat, 10 Mar 2018 02:12:44 GMT

@Hexwrote:
I always do AZEO but I need need to report close to 1% or I lose points. If I reported $318 last month and lost 10 points on Equifax. I let a second card report $200 and got the 10 points back. I think reporting only $5 would tank my scores. I have $61K in available credit.

Yesss. Glad you brought up utilization with respect to AZEO as that will be part 2 of my little experiment.

AZEO with only $5 reporting dropped my percent of utilization from 1% to 0% -- it did not round up to 1% as others have claimed usually happens. Is it possible the reporting of 0% prevented the potential point increase from AZEO; perhaps it didn't hurt because a balance still reported, but didn't help at all?? I don't know, but I'll find out in a few days. The card that reported $5 (from February) will report ~$380 sometime early next week (with the other 2 cards still at $0) so utilization will increase back to 1% . Barring any other unforseen changes to my credit report between now and then, I'll see if the utilization factor changes the AZEO outcome.

Re: AZEO Bum Results

Hex — Sat, 10 Mar 2018 02:25:26 GMT

Yes the $318 I reported also reported a comment of 0% with no rounding up. I bet when you let that $380 report you will gain about 10 points.

Re: AZEO Bum Results

thornback — Sat, 10 Mar 2018 02:27:09 GMT

@Hexwrote:
Yes the $318 I reported also reported a comment of 0% with no rounding up. I bet when you let that $380 report you will gain about 10 points.

We shall see. I will update next week.

Re: AZEO Bum Results

Anonymous — Sat, 10 Mar 2018 03:31:10 GMT

@thornbackwrote:
I agree, but utilization reduction wasn't an issue nor the purpose of implementing AZEO in my case. I just wanted to try it to see if it would positively affect my profile. I'm gardening, so I have nothing better to do but see how my scores respond to various, isolated factors. Now I know for sure that it doesn't matter, for me, how many of cards report a balance - though a prior experiment proved my profile to be very sensitive to utilization.

As for thin vs. thick file -- I'm not sure how mine would be categorized. I have 14 accounts consisting of 11 student loans and 3 CCs (15 total accounts if you count the paid charge-off). My AAoA is 2.8 years and my oldest account is 5.1 years. My revolving credit history is lacking / thin, as all 3 CCs are only 5 months old.

Are the 11 student loans all open loans? If so, this may be one of the reasons your AZEO test did not reveal a score change. When you had exactly one card reporting a balance you had many open accounts reporting a balance (12 accounts out of 14). When you had all your credit cards reporting a balance, you still had many accounts reporting a balance (14 out of 14). The wording of the negative reason statements does not specify that it is too many revolving accounts -- just accounts (which conceivably could include installment). It also does not specify a ratio test being used -- FICO might consider the raw number as well as the percentage. In your case you had a high raw number (12) and a high percentage (12/14).

A clear unmistakable test of the sensitivity of FICO 8 to number of cards reporting a balance would be a person who has 0 or 1 loans and many cards (say 12+). If such a person went from 1 card reporting a balance to all cards reporting a balance with no score change or almost no score change, that would much more meaningfully suggest that FICO 8 does not care about this factor. (Even then we'd want to know whether his profile was dirty or not.)

Regarding the thin vs. thick issue (your last question) your profile is definitely not thin. Thin/thick refers to the number of accounts -- account age is not part of that. A profile that has a small number of accounts (1-2 or even 3) is thin. A profile with 6+ accounts is not thin. Thin profiles that are clean are placed in a special scorecard that is capped at how how its score can go. That's why every person should consider as a medium term goal acquiring more than four accounts.

Re: AZEO Bum Results

thornback — Sat, 10 Mar 2018 03:38:31 GMT

@Anonymouswrote:
@thornbackwrote:
@Anonymouswrote:
@Anonymouswrote:
@NRB525So many of the comments about AZEO are over-selling the benefits.
I agree completely. In the thread that I started 1-2 months back discussing the benefit of 3 cards (with AZEO) in place verses just 1 card, reported gains ranged from 4-12 points, with the average being about 8 points. I think the perceived gain when people are using words like "maximize" as you stated above is much greater than that. It really isn't a dramatic difference.

You also make a very good point about dirty verses clean files. When my file was dirty, like the OP, I could allow 25%, 50%, 75% or 100% of my cards report balances and my score wouldn't budge. The only time it changed was when all cards reported $0. While AZEO may help a bit on a clean file, I'm not sure the minor benefits are really there with a dirty file.
It varies from profile to profile how many Points one can get. For most it’s in the 10 to 20 point range when going from $0 on all to one showing a small balance. Dirty or clean file there is benefits. But, going from above 50% or 80% usage and higher it’s a huge improvement. Like 50 to 75 points. It all depends on where one started. The thinner the file the higher the points are generally. One who has a thick file is on the lower end for most. There is always exceptions because no one knows exactly how the formulas work. And things unknown can offset gains in some profiles. There are people who oversell the benefits. And if someone isn’t applying for anything there is no need to do AZERO at every month. Just before one applies for something.
I agree, but utilization reduction wasn't an issue nor the purpose of implementing AZEO in my case. I just wanted to try it to see if it would positively affect my profile. I'm gardening, so I have nothing better to do but see how my scores respond to various, isolated factors. Now I know for sure that it doesn't matter, for me, how many of cards report a balance - though a prior experiment proved my profile to be very sensitive to utilization.

As for thin vs. thick file -- I'm not sure how mine would be categorized. I have 14 accounts consisting of 11 student loans and 3 CCs (15 total accounts if you count the paid charge-off). My AAoA is 2.8 years and my oldest account is 5.1 years. My revolving credit history is lacking / thin, as all 3 CCs are only 5 months old.
Are the 11 student loans all open loans? If so, this may be one of the reasons your AZEO test did not reveal a score change. When you had exactly one card reporting a balance you had many open accounts reporting a balance (12 accounts out of 14). When you had all your credit cards reporting a balance, you still had many accounts reporting a balance (14 out of 14). The wording of the negative reason statements does not specify that it is too many revolving accounts -- just accounts (which conceivably could include installment). It also does not specify a ratio test being used -- FICO might consider the raw number as well as the percentage. In your case you had a high raw number (12) and a high percentage (12/14).

A clear unmistakable test of the sensitivity of FICO 8 to number of cards reporting a balance would be a person who has 0 or 1 loans and many cards (say 12+). If such a person went from 1 card reporting a balance to all cards reporting a balance with no score change or almost no score change, that would much more meaningfully suggest that FICO 8 does not care about this factor. (Even then we'd want to know whether his profile was dirty or not.)

Regarding the thin vs. thick issue (your last question) your profile is definitely not thin. Thin/thick refers to the number of accounts -- account age is not part of that. A profile that has a small number of accounts (1-2 or even 3) is thin. A profile with 6+ accounts is not thin. Thin profiles that are clean are placed in a special scorecard that is capped at how how its score can go. That's why every person should consider as a medium term goal acquiring more than four accounts.

My loans are listed by each bureau as closed because they are still in deferrment (I still pay them down a bit monthly tho). But I do get the "loan balances too high compared to loan amounts" (or whatever it says) reason code -- so I guess FICO views them as open installments. Good points you make there, thanks for chiming in!

Re: AZEO Bum Results

Anonymous — Sat, 10 Mar 2018 03:48:34 GMT

How weird. I had no idea that the bureaus classified a student loan in deferment as closed. Weird, because it is not closed. Manifestly not closed. Cause you opened it and you haven't closed it yet.

Regardless, I am sure that FICO counts every account with a balance (closed or open) as an account with a balance. So from FICO's perspective you have many accounts showing a balance... even when you had exactly one card showing a balance.

Re: AZEO Bum Results

thornback — Sat, 10 Mar 2018 04:16:41 GMT

I know, the 'closed' status never made much sense to me either. The only thing I can figure is for record keeping purposes because, while encouraged, payment is not required during this time so it is impossible to have a late payment added to the payment history. Perhaps it's a means of keeping track so to maintain reporting accuracy. Either way, what you say makes perfect sense and I hadn't thought about how the loans may affect AZEO. Appreciate the feedback.

@Anonymouswrote:
How weird. I had no idea that the bureaus classified a student loan in deferment as closed. Weird, because it is not closed. Manifestly not closed. Cause you opened it and you haven't closed it yet.

Regardless, I am sure that FICO counts every account with a balance (closed or open) as an account with a balance. So from FICO's perspective you have many accounts showing a balance... even when you had exactly one card showing a balance.

Re: AZEO Bum Results

SouthJamaica — Sat, 10 Mar 2018 12:01:48 GMT

@thornbackwrote:
So, I finally managed AZEO. I have 3 revolving credit cards (no AU or charge cards) and aggregate util is always around 1-2% with individual util less than 8%.

While implementing AZEO, I watched my scores as I went from two to three cards reporting, back to two cards reporting, and, finally, to one card reporting a balance of $5.

FICO 8 Results (all bureaus):
2 to 3 cards reporting: +/- 0
3 to 2 cards reporting: +/- 0
2 to 1 card reporting: +/- 0

My scores have been stable for the past few months and did not budge with AZEO.

However, AZEO did increase my EX Mortgage / FICO Score 2 (+10) - I do not have access to TU / EQ mortage scores. Too bad that doesn't matter to me as I'm not currently seeking a mortgage.

So, since this method has no affect on my standard FICO profile, I'll just let my cards report normally as I maintain low util. I know I lose points when aggregate meets or exceeds 8.9% and / or individual meets or exceeds 28.9%.

It would have been nice to squeeze out a few extra points tho - eventhough I'm not so sure I would have been willing to maintain AZEO every month to keep them; it just would have been nice to know I had a quick method of increasing my score if necessary. Oh well...

AZEO was recommended as a simple way of ensuring that scores are optimized across all models, especially the mortgage scores, which are believed to be more sensitive than the others to the "number of accounts reporting a balance" factor. Your test results support that notion.

Easily picking up 10 points on one's mortgage scores is no mean feat. Think of how many times people have come to this board asking if there's a way to quickly pick up some points on their mortgage score.

Re: AZEO Bum Results

thornback — Sat, 10 Mar 2018 17:43:42 GMT

@SouthJamaicawrote:
@thornback
AZEO was recommended as a simple way of ensuring that scores are optimized across all models, especially the mortgage scores, which are believed to be more sensitive than the others to the "number of accounts reporting a balance" factor. Your test results support that notion.

Easily picking up 10 points on one's mortgage scores is no mean feat. Think of how many times people have come to this board asking if there's a way to quickly pick up some points on their mortgage score.

Yes, I was aware mortgage scores are believed to be more sensitive to AZEO than other FICO models - and this test proved that theory well given the fairly significant boost received for my FICO 2 score -- an amazing feat, and solid data point for anyone seeking to boost their mortgage scores. It was not my intention to minimize that fact, which is why I was sure to make mention of it in my original post.

However, since I am not seeking a mortgage, the purpose of testing AZEO was to see if it would positively affect my classic FICO, as it has for some others, which would have made AZEO a fairly solid means of obtaining an artificial score boost should the need arise. Perhaps my post was a bit selfish as it focused, primarily, on my own objective rather than the goals of those seeking a mortgage.

Re: AZEO Bum Results

SouthJamaica — Sat, 10 Mar 2018 18:11:38 GMT

@thornbackwrote:
@SouthJamaicawrote:
@thornback
AZEO was recommended as a simple way of ensuring that scores are optimized across all models, especially the mortgage scores, which are believed to be more sensitive than the others to the "number of accounts reporting a balance" factor. Your test results support that notion.

Easily picking up 10 points on one's mortgage scores is no mean feat. Think of how many times people have come to this board asking if there's a way to quickly pick up some points on their mortgage score.
Yes, I was aware mortgage scores are believed to be more sensitive to AZEO than other FICO models - and this test proved that theory well given the fairly significant boost received for my FICO 2 score -- an amazing feat, and solid data point for anyone seeking to boost their mortgage scores. It was not my intention to minimize that fact, which is why I was sure to make mention of it in my original post.

However, since I am not seeking a mortgage, the purpose of testing AZEO was to see if it would positively affect my classic FICO, as it has for some others, which would have made AZEO a fairly solid means of obtaining an artificial score boost should the need arise. Perhaps my post was a bit selfish as it focused, primarily, on my own objective rather than the goals of those seeking a mortgage.

Your post wasn't selfish at all.

I just wanted to point out that the effect on the mortgage score was excellent, and important. And that AZEO theory wasn't really designed to boost FICO 8's, but was designed as sort of a lazy man's way of insuring that one is not doing harm to optimization of revolving utilization across the board. [Had your FICO 8's gone DOWN, this little test would have WRECKED that theory]

Re: AZEO Bum Results

thornback — Sat, 10 Mar 2018 18:17:39 GMT

@SouthJamaicawrote:
@thornback
Your post wasn't selfish at all.

I just wanted to point out that the effect on the mortgage score was excellent, and important. And that AZEO theory wasn't really designed to boost FICO 8's, but was designed as sort of a lazy man's way of insuring that one is not doing harm to optimization of revolving utilization across the board. [Had your FICO 8's gone DOWN, this little test would have WRECKED that theory]

Oh good. The last thing I'd want to do is display little concern for others and their credit goals! It is a rather amazing technique with respect to the mortgage models... major kudos to the person that discovered it.