topic Re: 50% Individual utilization --> 6 point drop in Understanding FICO® Scoring

50% Individual utilization --> 6 point drop

SouthJamaica — Wed, 12 Dec 2018 16:58:19 GMT

Unsurprising score change, just mentioning to compare 4 scoring models.

Overnight 1 card went from 0% to 57%, raising overall utilization from rounded 7% to rounded 9%, and number of revolving accounts with balances from 12/30 to 13/30.

Effect on 4 EX scores:

FICO 8 -6

FICO 2 -1

Bankcard 8 -6

Auto 8 -8

Re: 50% Individual utilization --> 6 point drop

Anonymous — Wed, 12 Dec 2018 17:02:13 GMT

Refresh my memory, SJ, but do you have another card with a > 50% reported balance currently? This also takes you to 1 more account with a balance, but if your profile is anything like mine that's a non-factor on EX.

It looks like your aggregate utilization is straddling the 8.9% threshold; have you tested the impact of crossing that at all?

Re: 50% Individual utilization --> 6 point drop

SouthJamaica — Wed, 12 Dec 2018 17:10:45 GMT

@Anonymous wrote:
Refresh my memory, SJ, but do you have another card with a > 50% reported balance currently? This also takes you to 1 more account with a balance, but if your profile is anything like mine that's a non-factor on EX.

It looks like your aggregate utilization is straddling the 8.9% threshold; have you tested the impact of crossing that at all?

A few days ago all accounts were under 30%, but the other day, 1 account went from 20-something % to 42%. When that happened, there was no change in the EX scores. But then when this next account went from 0 to 57, boom.

Unfortunately, I won't be able to test the 6/7% thing for a while.

Yeah if today's EX utilization weren't rounded up, using EX's figures it would be 8.697%.

And no, I haven't looked at crossing the 8.9% threshold, but unfortunately I will involuntarily be doing that shortly

Re: 50% Individual utilization --> 6 point drop

Anonymous — Wed, 12 Dec 2018 17:13:28 GMT

That'll be interesting to see. What were you thinking, 15-20 points? I think you referenced around that point value in crossing the same threshold for installment loan utilization a while back... perhaps you'd see around the same on revolving utilization.

Re: 50% Individual utilization --> 6 point drop

SouthJamaica — Fri, 14 Dec 2018 17:08:04 GMT

@Anonymous wrote:
That'll be interesting to see. What were you thinking, 15-20 points? I think you referenced around that point value in crossing the same threshold for installment loan utilization a while back... perhaps you'd see around the same on revolving utilization.

No I don't expect anything like that. In fact I'm not sure I'll see any decrease at all. I think the hit I took today, when I reached the rounded 9%, is the hit I'm going to take.

We may know more about 9 days from now, when my overall utilization will exceed 9%. But I'm not sure it will exceed 9% enough to be in the 10% territory, as opposed to being rounded down to 9%.

Re: 50% Individual utilization --> 6 point drop

Thomas_Thumb — Wed, 12 Dec 2018 20:14:57 GMT

@SouthJamaica wrote:
@Anonymous wrote:
That'll be interesting to see. What were you thinking, 15-20 points? I think you referenced around that point value in crossing the same threshold for installment loan utilization a while back... perhaps you'd see around the same on revolving utilization.
No I don't expect anything like that. In fact I'm not sure I'll see any decrease at all. I thank the hit I took today, when I reached the rounded 9%, is the hit I'm going to take.

We may know more about 9 days from now, when my overall utilization will exceed 9%. But I'm not sure it will exceed 9% enough to be in the 10% territory, as opposed to being rounded down to 9%.

I generally describe thresholds as follows:

1) below 9% (8% is below 9% as is 8.9% as is 8.99%)

2) 9% to below 29%

3) 29% to below 49%

4) 49% to below 69%

5) 69% to below 89%

6) 89% and above

A card posting utilization at 50 something % would have crossed the 49% level. An aggregate utilization of 8.5% would not have crossed the 9% aggregate threshold but, if it rises to 9.1% then the threshold will have been crossed. FWIW, that's how I look at it.

Given the above, your latest drop would likely be related to the card going over 49% and then a further TBD drop would be anticipated if/when aggregate reaches 9% prior to rounding up.

Re: 50% Individual utilization --> 6 point drop

SouthJamaica — Wed, 12 Dec 2018 19:01:34 GMT

@Thomas_Thumb wrote:
@SouthJamaica wrote:
@Anonymous wrote:
That'll be interesting to see. What were you thinking, 15-20 points? I think you referenced around that point value in crossing the same threshold for installment loan utilization a while back... perhaps you'd see around the same on revolving utilization.
No I don't expect anything like that. In fact I'm not sure I'll see any decrease at all. I thank the hit I took today, when I reached the rounded 9%, is the hit I'm going to take.

We may know more about 9 days from now, when my overall utilization will exceed 9%. But I'm not sure it will exceed 9% enough to be in the 10% territory, as opposed to being rounded down to 9%.

I generally describe thresholds as follows:
1) below 9% (8% is below 9% as is 8.9% as is 8.99%)
2) 9% to below 29%
3) 29% to below 49%
4) 49% to below 69%
5) 69% to below 89%
6) 89% and above

A card in posting utilization at 50 something % would have crossed the 49% level. An aggregate utilization of 8.5% would not have crossed the 9% aggregate threshold but, if it rises to 9.1% then the threshold will have been crossed. FWIW, that's how I look at it.

Given the above, your latest drop would likely be related to the card going over 49% and then a further TBD drop would be anticipated if/when aggregate reaches 9% prior to rounding up.

My gut feeling from the way my EX scores are behaving is that it's not the true percentage that counts but the rounded percentage. I.e. if it's rounded up or down to 9% it's 9% for scoring purposes, so that there's no difference between 9.3% and 8.7%.

Now that I'm getting 4 EX scores daily in real time, I think I'm going to be able to test that. Either my gut feeling is baloney, or it's dead on.

Re: 50% Individual utilization --> 6 point drop

Thomas_Thumb — Wed, 12 Dec 2018 20:22:28 GMT

So, basically you are thinking utilization rounds to the nearest whole number as opposed to always rounding up. Also that the threshold after rounding is 9%, not 10%.

In your hypothesis going from 8.2% to either 8.7% or 9.2% would have as scoring impact because the threshold is 9% and both 8.7% and 9.2% round to 9%. In contrast, 8.7% would not reach the next threshold (10%) but 9.2% would if utilization always rounds up.

Re: 50% Individual utilization --> 6 point drop

Anonymous — Wed, 12 Dec 2018 21:03:08 GMT

@SouthJamaica wrote:
We may know more about 9 days from now, when my overall utilization will exceed 9%. But I'm not sure it will exceed 9% enough to be in the 10% territory, as opposed to being rounded down to 9%.

Yeah, that's what I was referring to... the aggregate utilization crossing of that first threshold (be it 9%, 10%, whatever). Curious what you think your score drops may look like if/when that happens?

Re: 50% Individual utilization --> 6 point drop

SouthJamaica — Wed, 12 Dec 2018 21:26:33 GMT

@Thomas_Thumb wrote:
So, basically you are thinking utilization rounds to the nearest whole number as opposed to always rounding up. Also that the threshold after rounding is 9%, not 10%.

That's my gut feeling from what I've been seeing in the few weeks I've had an opportunity to monitor the EX scores in real time. But I'm by no means sure, and need to watch the changes going forward to see if my new hypothesis has validity.

In your hypothesis going from 8.2% to either 8.7% or 9.2% would have as scoring impact because the threshold is 9% and both 8.7% and 9.2% round to 9%.

Yes but (a) it's just a hypothesis and (b) I have no serious experience watching any version of 9% -- actual or rounded -- since historically, since I've been on MyFICO, my overall utilization has been much lower. But yes, in my untested supposition, going from 8.2% to 8.7% would have the same scoring impact as going from 8.2% to 9.2%.

In contrast, 8.7% would not reach the next threshold (10%) but 9.2% would if utilization always rounds up.

I guess so. In my very limited experience I haven't noticed everything rounding up. But I have an open mind. Just trying to observe and learn right now. If my hypotheses are supported by lots of testing, then I'll become dogmatic about it And if they're not, then I'll toss them.

Re: 50% Individual utilization --> 6 point drop

SouthJamaica — Wed, 12 Dec 2018 21:30:34 GMT

@Anonymous wrote:
@SouthJamaica wrote:
We may know more about 9 days from now, when my overall utilization will exceed 9%. But I'm not sure it will exceed 9% enough to be in the 10% territory, as opposed to being rounded down to 9%.

Yeah, that's what I was referring to... the aggregate utilization crossing of that first threshold (be it 9%, 10%, whatever). Curious what you think your score drops may look like if/when that happens?

I'm not expecting a big score drop if and when it gets to a rounded 10%. I think 9% was the spot. But I'm in uncharted territory here I never before had daily realtime access to 4 different FICO scores, all based on the same data. And I have very little experience with overall utilization greater than 5%.

Re: 50% Individual utilization --> 6 point drop

Anonymous — Wed, 12 Dec 2018 21:37:00 GMT

With aggregate utilization being King to individual card utilization, if you're seeing small score movements based on individual cards, I would anticipate you seeing more if an aggregate utilization threshold was crossed. I've never crossed one personally, so I can't speak from personal experience.

Re: 50% Individual utilization --> 6 point drop

SouthJamaica — Wed, 12 Dec 2018 22:46:18 GMT

@Anonymous wrote:
With aggregate utilization being King to individual card utilization, if you're seeing small score movements based on individual cards, I would anticipate you seeing more if an aggregate utilization threshold was crossed. I've never crossed one personally, so I can't speak from personal experience.

Well I'll be keeping an eye on it closely. And reporting back. I too have little prior experience with the overall utilization thresholds. And have never, until recently, had daily realtime access to 4 FICO scores.

Re: 50% Individual utilization --> 6 point drop

NRB525 — Thu, 13 Dec 2018 11:26:53 GMT

@SouthJamaica wrote:
@Anonymous wrote:
@SouthJamaica wrote:
We may know more about 9 days from now, when my overall utilization will exceed 9%. But I'm not sure it will exceed 9% enough to be in the 10% territory, as opposed to being rounded down to 9%.

Yeah, that's what I was referring to... the aggregate utilization crossing of that first threshold (be it 9%, 10%, whatever). Curious what you think your score drops may look like if/when that happens?
I'm not expecting a big score drop if and when it gets to a rounded 10%. I think 9% was the spot. But I'm in uncharted territory here I never before had daily realtime access to 4 different FICO scores, all based on the same data. And I have very little experience with overall utilization greater than 5%.

How long did you say you have been getting these scores?

And it would be helpful if you shared the exact dollars of balances vs your specific and aggregate limits. The terms “rounded 9” and “rounded 10” leave a lot to the imagination.

Re: 50% Individual utilization --> 6 point drop

Anonymous — Thu, 13 Dec 2018 13:37:03 GMT

I don't see anything imaginative when it comes to rounding; Rounding is a pretty simple concept. There's no need for SJ to list the balance and limit dollars for you to divide out and see the percentage, as he already did that on the previous page (giving the unrounded percentage) but as with many threads you've chosen to ignore what's already been covered and essentially ask the same question again.

I also find it troublesome that you tend to ask the same questions multiple times yourself, but fail to answer questions asked of you even once.

Re: 50% Individual utilization --> 6 point drop

NRB525 — Fri, 14 Dec 2018 04:30:51 GMT

@Anonymous wrote:
I don't see anything imaginative when it comes to rounding; Rounding is a pretty simple concept. There's no need for SJ to list the balance and limit dollars for you to divide out and see the percentage, as he already did that on the previous page (giving the unrounded percentage) but as with many threads you've chosen to ignore what's already been covered and essentially ask the same question again.

I also find it troublesome that you tend to ask the same questions multiple times yourself, but fail to answer questions asked of you even once.

TT’s first comment on rounding puts 8.9% as rounding to 8%. 9% starts 9%.

SJ, on the other hand, interprets anything 8.6 to 9.5 as “9% rounded”, and 9.6% to 10.5% would be “10% rounded. That’s quite a wide range for interpretation.

With significant differences in interpretation, specifics is always clearer.

I repeat basic data questions for reasons such as this. Specific numbers can be recalculated and understood as a common language. If SJ doesn’t see a score change at 8.7% but does at 9.1%, that becomes a problem for the rounding presumption. But we won’t know that if the data presented is “9 rounded, score changed one time, but not the next time. I don’t understand ”.

I tend to repeat fundamental questions that have a real bearing on understanding the real situation a poster is bringing to the thread. More often than not, this leads to better insight to get to the most likely answer for the question. Y

Re: 50% Individual utilization --> 6 point drop

SouthJamaica — Fri, 14 Dec 2018 14:11:43 GMT

The rounding off of 8.8% to 9% or 9.2% to 9% isn't a calculation of mine; I'm getting it directly from Experian. It's just an observation.

And in this early phase of testing, it appears that the rounded percentage, rather than the actual percentage, is what triggers score changes.

Re: 50% Individual utilization --> 6 point drop

HeavenOhio — Fri, 14 Dec 2018 16:45:02 GMT

SJ, keep in mind that Experian isn't FICO. It'd be easy for Experian to get utilization "wrong," just like several other services do.

Re: 50% Individual utilization --> 6 point drop

SouthJamaica — Fri, 14 Dec 2018 17:01:06 GMT

@HeavenOhio wrote:
SJ, keep in mind that Experian isn't FICO. It'd be easy for Experian to get utilization "wrong," just like several other services do.

Agreed. In fact I can assure you that it is wrong.

But what I am gauging is the FICO 8-FICO 2-FICO Auto 8-FICO Bankcard 8 score changes (a) calculated by EX (b) based on the data EX has.

No more and no less.

Re: 50% Individual utilization --> 6 point drop

Anonymous — Fri, 14 Dec 2018 17:10:04 GMT

@NRB525 wrote:
I tend to repeat fundamental questions that have a real bearing on understanding the real situation a poster is bringing to the thread. More often than not, this leads to better insight to get to the most likely answer for the question. Y

And what about ignoring questions asked of you? (the irony... this is another question just to be clear).