topic Re: 4 figures vs 5 figures in Understanding FICO® Scoring

4 figures vs 5 figures

SouthJamaica — Wed, 13 May 2020 17:24:13 GMT

Apart from the question of percentages in individual account utilization, I've developed a gut feeling that having an account which reports a 5 figure, as opposed to a 4 figure, balance costs FICO 8 points. E.g. $10,500 vs $9500.

Although I occasionally succumb to attractive promo interest rate balance transfer opportunities, I never go over 28% of the limit. But on those accounts with large limits this sometimes takes me to 10k or more. And I've felt that it cost points.

I'm trying to test that now, but may or may not be able to manage it.

If anyone else has had experience with this, or is in a position to try to test it, I would be curious to know what you find.

Re: 4 figures vs 5 figures

Brian_Earl_Spilner — Wed, 13 May 2020 16:41:00 GMT

I just crossed from 5 to 4 in my paydown. MyFico didn't notify me of a score change yet, but it notified me that the balances went down on EQ. It was also about 10% of my balance.

EDIT: sorry, I just woke up. Re-read your post. My change was for aggregate.

Re: 4 figures vs 5 figures

SouthJamaica — Wed, 13 May 2020 17:02:40 GMT

@Brian_Earl_Spilner wrote:
I just crossed from 5 to 4 in my paydown. MyFico didn't notify me of a score change yet, but it notified me that the balances went down on EQ. It was also about 10% of my balance.

EDIT: sorry, I just woke up. Re-read your post. My change was for aggregate.

Thanks. Yeah, I'm talking about individual account utilization. I should have been more clear about that, so I will reword my original post.

Re: 4 figures vs 5 figures

Revelate — Thu, 14 May 2020 00:25:04 GMT

I don't think it matters at least for FICO 8.

FICO 2 though has a reason code that looks suspiciously like balance though think it was aggregate but never really got a chance to test it.

What data beyond hunch makes you think this? My ability to test is limited... if I didn't have escrowed property tax for the Houston home I would probably hit 10k+ once a year easily between that and other expenses but my big spending appears to be done for now.

Actually I am fairly certain on EQ FICO 5 that there wasn't in my old limit testing but I didn't have access to FICO 8 then.

Re: 4 figures vs 5 figures

SouthJamaica — Thu, 14 May 2020 01:09:56 GMT

@Revelate wrote:
I don't think it matters at least for FICO 8.

FICO 2 though has a reason code that looks suspiciously like balance though think it was aggregate but never really got a chance to test it.

What data beyond hunch makes you think this? My ability to test is limited... if I didn't have escrowed property tax for the Houston home I would probably hit 10k+ once a year easily between that and other expenses but my big spending appears to be done for now.

Actually I am fairly certain on EQ FICO 5 that there wasn't in my old limit testing but I didn't have access to FICO 8 then.

It's not based on data but on a gut feeling. I seem to recall that when I bit on some promotional 0% balance transfer offers, and put together a few 40k credit limits to capitalize on them up to the tune of $11,200 (28%) each, creating my first intentional 5-figure balances... although my overall utilization wasn't raised, my FICO 8's lost some points. I've been thinking about it, and am trying to test it by eliminating all 5-figure balances this time around.

On last go-round I think I had 5 such balances reporting. This time I've eliminated 3 of them, and am working on the remaining 2. But (a) I'm not sure I have enough dough to do it without incurring interest expense, and (b) there's so much other stuff going on in my profile it's not really possible to test any one factor with precision.

Re: 4 figures vs 5 figures

Revelate — Thu, 14 May 2020 03:34:03 GMT

Well after doing some napkin math I am thinking about leveraging some strategic 0% BT's and if that happens I can certainly help test that.

Re: 4 figures vs 5 figures

SouthJamaica — Thu, 14 May 2020 04:50:48 GMT

@Revelate wrote:
Well after doing some napkin math I am thinking about leveraging some strategic 0% BT's and if that happens I can certainly help test that.

Well if you do it, it will be fascinating to see what happens. You're a better tester than I am

Meanwhile I'll be struggling to reduce my remaining 5-figure balances to 4-figures, while Covid 19 is kicking my butt financially. And if I can accomplish that, and it's a clear day without other stuff mucking it up, I'll certainly report back on whether there are any apparent tremors.

Actually I see that today I moved a 4th account from the 5 figure column to the 4 figure column, but it hasn't reported yet. If there is a score change, however, even in EX, I probably won't be able to swear that it was attributable to that.

Re: 4 figures vs 5 figures

Anonymous — Thu, 14 May 2020 04:54:52 GMT

" seem to recall that when I bit on some promotional 0% balance transfer offers"

could the hit have been from new accounts being added or a pull needed for the promo offer?

Re: 4 figures vs 5 figures

SouthJamaica — Thu, 14 May 2020 13:51:41 GMT

@Anonymous wrote:
" seem to recall that when I bit on some promotional 0% balance transfer offers"

could the hit have been from new accounts being added or a pull needed for the promo offer?

no, and

Re: 4 figures vs 5 figures

Anonymous — Thu, 14 May 2020 15:33:48 GMT

Perhaps it was simply the amount of cards that went to the 28% threshold, versus it being about the actual balance being 4 or 5 digits?

The biggest hit I ever took was $10K BT on a $20K CL, don't recall the actual point loss though. But my guess was that the hit was due to being over 50%. All other balances before or since have all been less than $5K, though on some cards that could hit the 28% easy. I generally prefer to hover at 18%.

Re: 4 figures vs 5 figures

Revelate — Thu, 14 May 2020 19:06:03 GMT

I think the right way to test this will be to get to 10K+ on some big tradeline for someone that has absurd levels of aggregate CL and then compare with the same individual utilization and point loss on a small tradeline.

As long as there isn't a meaningful aggregate change between the two (I think there would be on EX FICO 2 admittedly) it shouldn't be that awkward to test.

Re: 4 figures vs 5 figures

SouthJamaica — Thu, 14 May 2020 21:41:25 GMT

@Anonymous wrote:
Perhaps it was simply the amount of cards that went to the 28% threshold, versus it being about the actual balance being 4 or 5 digits?

The biggest hit I ever took was $10K BT on a $20K CL, don't recall the actual point loss though. But my guess was that the hit was due to being over 50%. All other balances before or since have all been less than $5K, though on some cards that could hit the 28% easy. I generally prefer to hover at 18%.

no everything was under the threshold, was just shuffling stuff around to take advantage of 0% interest

Re: 4 figures vs 5 figures

SouthJamaica — Thu, 14 May 2020 21:59:34 GMT

@Revelate wrote:
I think the right way to test this will be to get to 10K+ on some big tradeline for someone that has absurd levels of aggregate CL and then compare with the same individual utilization and point loss on a small tradeline.

As long as there isn't a meaningful aggregate change between the two (I think there would be on EX FICO 2 admittedly) it shouldn't be that awkward to test.

The test it might be possible for me to try would be this, with aggregate utilization & number of accounts with balances constant between the 2 test days:

Day 1: every revolving account at 28% or less, with one at $10k+, all others below $10k [my present configuration]

Day 2: every revolving account at 28% or less, and below $10k

If I can pull it off, and nothing else significant happens that day, I could measure EX FICO 8, 2, Auto 8, Auto 2, Bankcard 8, Bankcard 3, and Bankcard 2, to see if my gut feeling has any substance.

Re: 4 figures vs 5 figures

K-in-Boston — Fri, 15 May 2020 03:51:11 GMT

@Revelate wrote:
I think the right way to test this will be to get to 10K+ on some big tradeline for someone that has absurd levels of aggregate CL and then compare with the same individual utilization and point loss on a small tradeline.

As long as there isn't a meaningful aggregate change between the two (I think there would be on EX FICO 2 admittedly) it shouldn't be that awkward to test.

I have cards go from 4 digits to 5 digits or 5 to 4, and from $0 to 4 or 5 digits or 4 to 5 digits to $0 fairly often. I've never seen large 8-point swings as mentioned from that happening, unless something else was also happening at the same time. I think it's likely more about utilization, as FICO 8 shouldn't have any raw dollar amount things like that.

I have a card that went from 5 digits to 4 digits closing in a few days, but there are other things going on the same day so I don't know how much value would be in the DP. I know I have one account that will be going under $10k in a few months without crossing a util threshold like the one in a few days. I'll try to remember to chime back in.

Re: 4 figures vs 5 figures

SouthJamaica — Fri, 15 May 2020 13:38:57 GMT

@K-in-Boston wrote:
@Revelate wrote:
I think the right way to test this will be to get to 10K+ on some big tradeline for someone that has absurd levels of aggregate CL and then compare with the same individual utilization and point loss on a small tradeline.

As long as there isn't a meaningful aggregate change between the two (I think there would be on EX FICO 2 admittedly) it shouldn't be that awkward to test.
I have cards go from 4 digits to 5 digits or 5 to 4, and from $0 to 4 or 5 digits or 4 to 5 digits to $0 fairly often. I've never seen large 8-point swings as mentioned from that happening, unless something else was also happening at the same time. I think it's likely more about utilization, as FICO 8 shouldn't have any raw dollar amount things like that.

I have a card that went from 5 digits to 4 digits closing in a few days, but there are other things going on the same day so I don't know how much value would be in the DP. I know I have one account that will be going under $10k in a few months without crossing a util threshold like the one in a few days. I'll try to remember to chime back in.

Is that the only one that's presently reporting at 5 figures? If so, it would definitely be of interest if you can get any kind of clean signal (or clear absence of any signal) from it.

Re: 4 figures vs 5 figures

K-in-Boston — Fri, 15 May 2020 14:40:18 GMT

No. Do you think the potential penalty you are seeing is going from 0 cards to 1 card, rather than individual cards?

Re: 4 figures vs 5 figures

SouthJamaica — Fri, 15 May 2020 16:44:54 GMT

@K-in-Boston wrote:
No. Do you think the potential penalty you are seeing is going from 0 cards to 1 card, rather than individual cards?

I think it was from going from no cards above 10k to having 1 card above 10k.

I have this vague recollection that the day I decided to take advantage of a 0% APR balance transfer offer on a 40k account, and do some balance transfers up to 28%, or $11,200, a cold chill came over my FICO 8 scores.

Since then I haven't hesitated to add others, and haven't noticed any plus or minus when I toggle any of them between 4 and 5 figures. But for a while now there has always been at least one in the 10k+ category.

But this time around I'm trying to get rid of all of those, to see if any score change occurs when the last 5-figure balance drops out.

I've dropped 4 out of 5. The remaining one won't report until the beginning of month.

Unfortunately, however, due to Covid 19 weakness, I may not have enough dough to drop that one. And if I do succeed in dropping that one, the data won't be discernible, since that account is the only one that was above 30%, so the points I would pick up from dropping below 30% will be mixed in with the points, if any, I will definitely earn from dropping below 5 figures.

Re: 4 figures vs 5 figures

SouthJamaica — Fri, 15 May 2020 16:48:26 GMT

@SouthJamaica wrote:
@K-in-Boston wrote:
No. Do you think the potential penalty you are seeing is going from 0 cards to 1 card, rather than individual cards?
I think it was from going from no cards above 10k to having 1 card above 10k.

I have this vague recollection that the day I decided to take advantage of a 0% APR balance transfer offer on a 40k account, and do some balance transfers up to 28%, or $11,200, a cold chill came over my FICO 8 scores.

Since then I haven't hesitated to add others, and haven't noticed any plus or minus when I toggle any of them between 4 and 5 figures. But for a while now there has always been at least one in the 10k+ category.

But this time around I'm trying to get rid of all of those, to see if any score change occurs when the last 5-figure balance drops out.

I've dropped 4 out of 5. The remaining one won't report until the beginning of month.

Unfortunately, however, due to Covid 19 weakness, I may not have enough dough to drop that one. And if I do succeed in dropping that one, the data won't be discernible, since that account is the only one that was above 30%, so the points I would pick up from dropping below 30% will be mixed in with the points, if any, I will definitely earn from dropping below 5 figures.

I just realized @Revelate that the test I wanted to try won't be meaningful, because the one 5-figure account left is also the only account I had that was > 30%, so if I do drop it to 4 figures the points I pick up from going under 30% will camouflage the points, if any, earned by going from 5 figures to 4 figures.

Re: 4 figures vs 5 figures

K-in-Boston — Fri, 15 May 2020 17:50:57 GMT

Yeah, that's why I mentioned earlier I am not sure how useful my 5-to-4 DP will be in a few days. It's dropping from $10k to $3k, but also from 40+% to around 13% (0% intro coming to an end soon that I've been riding out for a while).

Re: 4 figures vs 5 figures

SouthJamaica — Fri, 15 May 2020 18:21:59 GMT

@K-in-Boston wrote:
Yeah, that's why I mentioned earlier I am not sure how useful my 5-to-4 DP will be in a few days. It's dropping from $10k to $3k, but also from 40+% to around 13% (0% intro coming to an end soon that I've been riding out for a while).

Yeah well from my experience that would not mean anything anyway.

I'm just thinking that dropping from 1 to 0 might mean something.