topic Re: What are the Benefits Of The AZEO Method?? in Understanding FICO® Scoring

What are the Benefits Of The AZEO Method??

The-Credit-Disciple — Tue, 04 Sep 2018 17:43:31 GMT

Great Morning Fico Fam

What are The benefits of The AZEO Method?

What does it help Achieve?

What does it do to help your Scores?

What does it do to help with Loan applications(Car Loans, Mortgage, Personal Loans)?

What does it do to help with Credit Card Apps?

reason I am asking is because it seems like a great method and I would like to try it, but I would Love to hear your feedback Fico Fam from your experiences if you have used this method Thanks Fico Fam in advance

Re: What are the Benefits Of The AZEO Method??

ChessChik47 — Tue, 04 Sep 2018 17:57:12 GMT

Hi OP! This topic has been discussed thoroughly in the forums. Just do a quick search and I promise you all your questions will be answered. Bottom line, it's a good method to use if you're looking to maximize your FICO score prior to applying for a new credit account (card, loan, etc.). If you're not seeking new credit, just use your cards "naturally", pay your bills after your statements cut and before the due date, then rinse and repeat.

Re: What are the Benefits Of The AZEO Method??

Anonymous — Tue, 04 Sep 2018 19:25:51 GMT

@ChessChik47 wrote:
Hi OP! This topic has been discussed thoroughly in the forums. Just do a quick search and I promise you all your questions will be answered. Bottom line, it's a good method to use if you're looking to maximize your FICO score prior to applying for a new credit account (card, loan, etc.). If you're not seeking new credit, just use your cards "naturally", pay your bills after your statements cut and before the due date, then rinse and repeat.

This. AZEO and similar micromanaging can have its place if you absolutely need to maximize your score for an app (and even if you ARE apping, you often don't really need to do this, if your score is already way above a threshold).

What is often lost by the AZEO "cult" here is that it comes at a price. In return for all the swipe fees, and interest charges from those that don't pay in full every month, the nice Credit Card issuers basically give you a free loan: you make all those charges, we will pay the merchant (minus our very reasonable fee), and you don't need to pay us back until the due date. As due dates are usually at least 20 days after closing, if you make a charge at the very beginning of the new cycle, you are getting an interest free loan for nearly two months.

AZEO loses some of this every month, causing you to give up some of this free money (leave it in an interest paying account until near the due date). It might be worth it for those very special apps. But almost certainly not every card, every month.

Re: What are the Benefits Of The AZEO Method??

Anonymous — Wed, 05 Sep 2018 03:44:18 GMT

Cost of AZEO aside, let's look at the merit of AZEO, imagine you're a credit analyst/loan officer looking at 2 profiles with the same amount of installment loans/CCs and 100% payment history and you have no clue what an AZEO is, 1st profile has a score of 760 and 1 out of 8 CC reporting a balance of $5 with the rest $0, 2nd profile has a score of 754 with balance on 6 out of 8 cards and an aggregate UTI < 8.9%.

Which one would you think is using their credit, and using it responsibly? Which one are you more likely to grant new or additional credit?

Re: What are the Benefits Of The AZEO Method??

Anonymous — Wed, 05 Sep 2018 03:47:53 GMT

@Anonymous wrote:
Cost of AZEO aside, let's look at the merit of AZEO, imagine you're a credit analyst/loan officer looking at 2 profiles with the same amount of installment loans/CCs and 100% payment history and you have no clue what an AZEO is, 1st profile has a score of 760 and 1 out of 8 CC reporting a balance of $5 with the rest $0, 2nd profile has a score of 754 with balance on 6 out of 8 cards and an aggregate UTI < 8.9%.

Which one would you think is using their credit, and using it responsibly? Which one are you more likely to grant new or additional credit?

The second profile because it shows that the consumer is more likely to be profitable than the first. The consumer of the second profile is very responsible with his or her credit while actually using it.

Re: What are the Benefits Of The AZEO Method??

arkane — Wed, 05 Sep 2018 04:10:30 GMT

@Anonymous wrote:
Cost of AZEO aside, let's look at the merit of AZEO, imagine you're a credit analyst/loan officer looking at 2 profiles with the same amount of installment loans/CCs and 100% payment history and you have no clue what an AZEO is, 1st profile has a score of 760 and 1 out of 8 CC reporting a balance of $5 with the rest $0, 2nd profile has a score of 754 with balance on 6 out of 8 cards and an aggregate UTI < 8.9%.

Which one would you think is using their credit, and using it responsibly? Which one are you more likely to grant new or additional credit?

Plot twist: Said analyst works for Barclays, so the answer is the first profile.

Jokes aside, I'm going to see in about a week what my scores look like with 4/4 cards reporting. I probably wouldn't apply for new cards with 4/4, but so far the difference between 3/4 and AZEO has only been one point on EQ and TU, so I'm not gonna bother with AZEO going forward. I'm actually leaning towards applying with 3/4 reporting, but of course making sure total util is <8.9% (and maybe even keep individual util <8.9% as well) for precisely the scenario you described.

Re: What are the Benefits Of The AZEO Method??

Miner — Wed, 05 Sep 2018 07:45:32 GMT

For me, AZEO gains me 11 pts on TU, but does little on the other two. I know because I came off it last month by accident and just went back on. But other profiles score changes can vary a lot.

I care only because my scores are borderline for some things and I want to increase my chances for credit line increases, qualify for some pre-approvals as I'm trying to add some of the better credit cards, and as a moral booster as it makes my scores less depressing.

But in a few months after my remaining negatives fall off and I finish a mini CC app spree in celebration, I doubt I'll care anymore until I get ready to app for something.

For people who impulsively app at credit offers, they would have more incentive to follow it religiously.

Re: What are the Benefits Of The AZEO Method??

Anonymous — Thu, 06 Sep 2018 01:26:03 GMT

@AnonymousCost of AZEO aside, let's look at the merit of AZEO, imagine you're a credit analyst/loan officer looking at 2 profiles with the same amount of installment loans/CCs and 100% payment history and you have no clue what an AZEO is, 1st profile has a score of 760 and 1 out of 8 CC reporting a balance of $5 with the rest $0, 2nd profile has a score of 754 with balance on 6 out of 8 cards and an aggregate UTI < 8.9%.

Which one would you think is using their credit, and using it responsibly? Which one are you more likely to grant new or additional credit?

While I certainly get your point above, I'd say there isn't enough information there to really say. For example, if someone has very high credit limits and is at < 8.9% utilization, they can still have thousands or even tens of thousands of dollars in revolving debt. In this example I would say the person with a single $5 balance presents less of a real world risk upon a MR when on paper both individuals may possess nearly identical profiles/scores.

Re: What are the Benefits Of The AZEO Method??

SouthJamaica — Thu, 06 Sep 2018 01:31:46 GMT

@The-Credit-Disciple wrote:
Great Morning Fico Fam

What are The benefits of The AZEO Method?
What does it help Achieve?
What does it do to help your Scores?
What does it do to help with Loan applications(Car Loans, Mortgage, Personal Loans)?
What does it do to help with Credit Card Apps?

reason I am asking is because it seems like a great method and I would like to try it, but I would Love to hear your feedback Fico Fam from your experiences if you have used this method Thanks Fico Fam in advance

IMHO its only real benefit is that it's an insurance policy.

The one thing you know, if all but one of your revolving accounts are reporting a zero balance, and the one card is reporting a small balance, is that you're not shooting yourself in the foot in some FICO scoring model.

Re: What are the Benefits Of The AZEO Method??

Anonymous — Thu, 06 Sep 2018 01:53:33 GMT

@Anonymous wrote:
@AnonymousCost of AZEO aside, let's look at the merit of AZEO, imagine you're a credit analyst/loan officer looking at 2 profiles with the same amount of installment loans/CCs and 100% payment history and you have no clue what an AZEO is, 1st profile has a score of 760 and 1 out of 8 CC reporting a balance of $5 with the rest $0, 2nd profile has a score of 754 with balance on 6 out of 8 cards and an aggregate UTI < 8.9%.

Which one would you think is using their credit, and using it responsibly? Which one are you more likely to grant new or additional credit?
While I certainly get your point above, I'd say there isn't enough information there to really say. For example, if someone has very high credit limits and is at < 8.9% utilization, they can still have thousands or even tens of thousands of dollars in revolving debt. In this example I would say the person with a single $5 balance presents less of a real world risk upon a MR when on paper both individuals may possess nearly identical profiles/scores.

I see your point but why would you grant someone more credit who uses only $5 out of $100k+ total limit? I would still look favorably to the profile that has a long history and the ability to pay that $10k revolving debt in full every month.

Re: What are the Benefits Of The AZEO Method??

Anonymous — Thu, 06 Sep 2018 02:44:15 GMT

@SouthJamaica wrote:
@The-Credit-Disciple wrote:
Great Morning Fico Fam

What are The benefits of The AZEO Method?
What does it help Achieve?
What does it do to help your Scores?
What does it do to help with Loan applications(Car Loans, Mortgage, Personal Loans)?
What does it do to help with Credit Card Apps?

reason I am asking is because it seems like a great method and I would like to try it, but I would Love to hear your feedback Fico Fam from your experiences if you have used this method Thanks Fico Fam in advance
IMHO its only real benefit is that it's an insurance policy.

The one thing you know, if all but one of your revolving accounts are reporting a zero balance, and the one card is reporting a small balance, is that you're not shooting yourself in the foot in some FICO scoring model.

The difference for me going from 1 card reporting and 7/8 cards reporting was 0 points on EX/EQ and 3-5 points on TU, YMMV of course but I have yet to see data point of more than 11 points posted above on TU by Minor (little on EX/EQ). Even if it's more, right before apping for new credit will suffice, not worth the constant micromanaging and lost income to maintain at all times, whether it actually looks good to manual reviewers aside.

Re: What are the Benefits Of The AZEO Method??

Anonymous — Thu, 06 Sep 2018 03:39:16 GMT

@Anonymous
I see your point but why would you grant someone more credit who uses only $5 out of $100k+ total limit? I would still look favorably to the profile that has a long history and the ability to pay that $10k revolving debt in full every month.

Not using, reporting. Someone can use tens of thousands of dollars in revolving credit per month and still report 5 bucks. And, it happens all the time. I've taken myself to AZEO with a small balance (say, $5) prior to each of my last 7 applications and each has resulted in a favorable result. This is when my monthly spend on CCs is usually in the $3k-$5k range. Also keeping the snapshot in point of time in mind here, seeing $10k+ in revolving debt is what would happen and the lender wouldn't necessarily know that it's being PIF monthly.

Re: What are the Benefits Of The AZEO Method??

Anonymous — Thu, 06 Sep 2018 03:43:12 GMT

@Anonymous
The difference for me going from 1 card reporting and 7/8 cards reporting was 0 points on EX/EQ and 3-5 points on TU, YMMV of course but I have yet to see data point of more than 11 points posted above on TU by Minor (little on EX/EQ). Even if it's more, right before apping for new credit will suffice, not worth the constant micromanaging and lost income to maintain at all times, whether it actually looks good to manual reviewers aside.

I've got a data point of 15 points lost on TU in going from AZEO to all accounts with balances. It actually may have been greater than 15 due to top end buffer; my actual score dropped from 850 to 835. On EQ I lost 11 points for the exact same experiment and on EX lost 0. Evidently EX is bulletproof when it comes to number of accounts with balances? It is for me, anyway.

Re: What are the Benefits Of The AZEO Method??

Anonymous — Thu, 06 Sep 2018 03:52:39 GMT

@Anonymous wrote:
@Anonymous
I see your point but why would you grant someone more credit who uses only $5 out of $100k+ total limit? I would still look favorably to the profile that has a long history and the ability to pay that $10k revolving debt in full every month.
Not using, reporting. Someone can use tens of thousands of dollars in revolving credit per month and still report 5 bucks. And, it happens all the time. I've taken myself to AZEO with a small balance (say, $5) prior to each of my last 7 applications and each has resulted in a favorable result. This is when my monthly spend on CCs is usually in the $3k-$5k range. Also keeping the snapshot in point of time in mind here, seeing $10k+ in revolving debt is what would happen and the lender wouldn't necessarily know that it's being PIF monthly.

Obviously we are talking about identical profile which includes monthly spending, just as lenders might not know if revolving debt is being PIF, they also have no way of knowing your 3-5k usage beyond $5.

I don't know how far back those 7 apps are but there is no way to tell if non AZEO wouldn't have produced favorable results if you kept UTI under a reasonable level. Currently your scores are 850 across the board and assuming they were decent during those apps, I doubt AZEO made much of a difference if any.

Re: What are the Benefits Of The AZEO Method??

Anonymous — Thu, 06 Sep 2018 04:10:46 GMT

@Anonymous wrote:
@Anonymous
The difference for me going from 1 card reporting and 7/8 cards reporting was 0 points on EX/EQ and 3-5 points on TU, YMMV of course but I have yet to see data point of more than 11 points posted above on TU by Minor (little on EX/EQ). Even if it's more, right before apping for new credit will suffice, not worth the constant micromanaging and lost income to maintain at all times, whether it actually looks good to manual reviewers aside.
I've got a data point of 15 points lost on TU in going from AZEO to all accounts with balances. It actually may have been greater than 15 due to top end buffer; my actual score dropped from 850 to 835. On EQ I lost 11 points for the exact same experiment and on EX lost 0. Evidently EX is bulletproof when it comes to number of accounts with balances? It is for me, anyway.

Man I wish I get that kind of gain when I go AZEO.

@Anonymous is bullet proof when it comes to just about everything lol, I spent a good part of a year experimenting from AZE5 to AZ then back out to AZE3 (one account at a time) before started just reporting everything naturally this March on 7 out of 8, Ex never moved other than 16 point loss/gain @ AZ.

Re: What are the Benefits Of The AZEO Method??

SouthJamaica — Thu, 06 Sep 2018 11:13:57 GMT

@Anonymous wrote:
@SouthJamaica wrote:
@The-Credit-Disciple wrote:
Great Morning Fico Fam

What are The benefits of The AZEO Method?
What does it help Achieve?
What does it do to help your Scores?
What does it do to help with Loan applications(Car Loans, Mortgage, Personal Loans)?
What does it do to help with Credit Card Apps?

reason I am asking is because it seems like a great method and I would like to try it, but I would Love to hear your feedback Fico Fam from your experiences if you have used this method Thanks Fico Fam in advance
IMHO its only real benefit is that it's an insurance policy.

The one thing you know, if all but one of your revolving accounts are reporting a zero balance, and the one card is reporting a small balance, is that you're not shooting yourself in the foot in some FICO scoring model.

The difference for me going from 1 card reporting and 7/8 cards reporting was 0 points on EX/EQ and 3-5 points on TU, YMMV of course but I have yet to see data point of more than 11 points posted above on TU by Minor (little on EX/EQ). Even if it's more, right before apping for new credit will suffice, not worth the constant micromanaging and lost income to maintain at all times, whether it actually looks good to manual reviewers aside.

You're missing my point. You're talking about FICO 8. I know it doesn't make much difference in FICO 8. But there are some models where it might cost you some points. It's a way to guarantee that you're not hurting yourself on revolving utilization in one of the other scoring models.

Re: What are the Benefits Of The AZEO Method??

Anonymous — Thu, 06 Sep 2018 12:59:12 GMT

@Anonymous
I don't know how far back those 7 apps are but there is no way to tell if non AZEO wouldn't have produced favorable results if you kept UTI under a reasonable level. Currently your scores are 850 across the board and assuming they were decent during those apps, I doubt AZEO made much of a difference if any.

I'm sure that's true. My point is that AZEO doesn't hurt and I've yet to hear an example of someone saying it adversely impacted a lending decision. It sounded like your point was that AZEO could hurt, as in a potential lender would rather not see someone at AZEO compared to someone else with 6 of 8 of their cards with balances. I simply don't believe that to be the case, but that's just my opinion.

Re: What are the Benefits Of The AZEO Method??

Queen_Etherea — Thu, 06 Sep 2018 15:26:27 GMT

@arkane wrote:
@Anonymous wrote:
Cost of AZEO aside, let's look at the merit of AZEO, imagine you're a credit analyst/loan officer looking at 2 profiles with the same amount of installment loans/CCs and 100% payment history and you have no clue what an AZEO is, 1st profile has a score of 760 and 1 out of 8 CC reporting a balance of $5 with the rest $0, 2nd profile has a score of 754 with balance on 6 out of 8 cards and an aggregate UTI < 8.9%.

Which one would you think is using their credit, and using it responsibly? Which one are you more likely to grant new or additional credit?
Plot twist: Said analyst works for Barclays, so the answer is the first profile.

Jokes aside, I'm going to see in about a week what my scores look like with 4/4 cards reporting. I probably wouldn't apply for new cards with 4/4, but so far the difference between 3/4 and AZEO has only been one point on EQ and TU, so I'm not gonna bother with AZEO going forward. I'm actually leaning towards applying with 3/4 reporting, but of course making sure total util is <8.9% (and maybe even keep individual util <8.9% as well) for precisely the scenario you described.

So I know that the credit simulators aren't even close to accurate, but when I try to see what would happen if I paid down the balance on my only reporting card, it only raises it like 5 points. I'm curious to see what's actually going to happen to when it reports below 30%. My usage on my profile right now is at 52%. I know the best util rate is below 8.9%, but I'll have to wait till next month to get it to that. Do you think my scores will increase more than 5 points if I do?

Re: What are the Benefits Of The AZEO Method??

Thomas_Thumb — Thu, 06 Sep 2018 17:06:02 GMT

@Queen_Etherea wrote:
@arkane
So I know that the credit simulators aren't even close to accurate, but when I try to see what would happen if I paid down the balance on my only reporting card, it only raises it like 5 points. I'm curious to see what's actually going to happen to when it reports below 30%. (want to report below 29%, not 30% for increased potential point gain)

My usage on my profile right now is at 52%. I know the best util rate is below 8.9%, but I'll have to wait till next month to get it to that. Do you think my scores will increase more than 5 points if I do?

If you go from 52% to below 29% (say 28%) I'd guess a 5 to 10 point gain is possible. You do want to cross below the 29% mark with the card. Next drop highest card utilization from below 28% to below 9% and tell us what happens - best to keep # cards with a balance constant to isolate card utilization effect.

What is and what will be your aggregate utilization after paydown?

Re: What are the Benefits Of The AZEO Method??

Anonymous — Thu, 06 Sep 2018 18:30:33 GMT

AZEO means the most (in terms of points) to anyone that has blemishes on their CR.

If you're sitting mid 700s with a clean CR, the +/- isn't going to mean much unless you're going from a very high utilization to a nominal one.

I have one of those blemished reports and AZEO can easily mean 20 points vs. letting 20-30% util report.