topic Re: Scoring Matrix is A Joke in Understanding FICO® Scoring

Scoring Matrix is A Joke

Gladius — Tue, 18 Sep 2018 08:59:03 GMT

Total balance on all retail cards decreases by $7200...no change whatsoever to Experian score,.......Gap card increases by $35, Experian score drops 3 points.....no other change to my profile......I will NEVER understand this scoring matrix....smh

Re: Scoring Matrix is A Joke

Anonymous — Tue, 18 Sep 2018 12:36:37 GMT

@GladiusTotal balance on all retail cards decreases by $7200...no change whatsoever to Experian score,.......Gap card increases by $35, Experian score drops 3 points.....no other change to my profile......I will NEVER understand this scoring matrix....smh

Not enough information above to really comment. You'd have to list out every one of your CCs with their balance/limit for us to be able to help explain what might be going on. Understand that you're being provided with "alerts" which simply mean that something alertable changed on your credit report. Reported balance changes trigger alerts, but the score changes you see often have nothing to do with the alert you received.

There are examples of how a $7200 paydown could not increase your score at all, while a $35 balance increase could drop your score.

For example, someone with very high overall credit limits (say, $100k+) could be at aggregate utilization of 8% and pay down $7200, bringing them to 1% aggregate utilization. It's possible that this paydown could result in no score change at all. This same person could have a $500 limit card with a $235 balance, meaning their utilization on that card was a little under 50%. If this was their highest utilization card, allowing the reported balance to increase $35 would then bring utilization on the card to over 50% which could easily explain a 3 point score drop.

Re: Scoring Matrix is A Joke

Thomas_Thumb — Tue, 18 Sep 2018 13:22:42 GMT

Generally quoted breakpoints for utilization are 9%, 29%, 49%, 69% and 89%. If your aggregate utilization crosses below or above one of these boundries then score is impacted. If your before/after utilization remains in the same bracket, then no impact on score.

Of course many other "card" factors affect score such as individual card utilization and # of cards reporting balances. The same thresholds apply to individual card utilization as aggregate. However, impact to score on a per card basis is much less than in aggregate and negative impact is typically not observed until crossing above 29% or sometimes 49% depending on profile. A change in # of cards reporting balances impacts score independent of utilization.

I recommend treating score changes of less than 5 points as noise. Paying down cards will certainly help long term both with score and financially. Adopt a PIF policy and ignore the point in time noise.

Re: Scoring Matrix is A Joke

Gladius — Wed, 19 Sep 2018 19:12:16 GMT

Now my TU shows the decrease and that score dropped 4 pts.....smh

I know, I know...many "factors" come into play but it's just frustrating when a positive action from me gets a negative reaction from them.

Re: Scoring Matrix is A Joke

Anonymous — Wed, 19 Sep 2018 20:21:07 GMT

What is your source of scores?

Remember that if you're receiving alerts your score changes don't necessarily have anything to do with the alerts. It's rare that a positive report change causes a negative scoring change. The two common examples would be reporting all $0 balances on your credit cards and closing your only open installment loan, neither of which is the case here.