topic Re: The 'All At Just Under 8.99% Utilization' experiment in Understanding FICO® Scoring

The 'All at less than 9% Utilization' experiment

Anonymous — Sun, 11 Oct 2020 13:32:05 GMT

Monthly Reports of 28 FICO Scores via myFICO Premier, with Reason Statements

DATE	DESCRIPTION
January 22, 2019	Now tracking 32 scores with reason code text on 28 FICO scores.
February 9, 2019	New table of 32 scores posted with updates on moving from 1 card with balance to 2 cards with a balance. 7/7/7% utilization.
March 8, 2019	AoYA 3mo jump is real. 24 out of 28 FICO scores up anywhere from +8 to +25 points.
April 10, 2019	The 'Five Percent' update of 28 FICO scores, moving from 6% utilization on each card to 5% on each.
May 10, 2019	'Five to Nine' update of 33 credit scores, moving from 5% to 9% utilization on each card.
June 10, 2019	AoYA 6mo update of 33 credit scores, moving from 9% to 4% utilization on each card.
July 10, 2019	AZEO update of 33 credit scores, moving from 2 cards with a balance to 1 card with a balance. 4% to 1% aggregate utilization.
August 10, 2019	AAoA 12mo update of 28 FICO scores.
September 10, 2019	AoYA 9mo update of 28 FICO scores.
October 10, 2019	AoYA 10mo update of 28 FICO scores.
November 10, 2019	AoYA 11mo / Off AZEO update of 28 FICO scores.
December 10, 2019	AoYA 1yr update of 28 FICO scores.
January 10, 2020	End of experiment. Final 28 score report at 1yr 1mo.

For the first 12 billing cycles on my 2 new credit cards, I am going to have them both report their utilization ratios at 8% before paying them in full. (2000/6500 cl's, 160/520 (8%) self-imposed spending limits.)

Hypothesis: Excellent payment history and a reported maximum credit utilization of just under 8.99% for 12 contiguous billing cycles on 100% of only 2 cards, with no other credit accounts, will change my FICO 8 score from 'good' to 'excellent' range. (Reported maximum means 'High Balance' never goes above 8% of credit limit on each card. I understand that FICO doesn't use the high balance.)

(Note: This is just a test of a hypothesis formed from reading several posts of some rather unusual positive FICO score changes from maintaining low utilization for several months at a time on a 'thin credit file'. I don't even think this hypothesis will be shown to be correct. I'll be happy if I end up with a FICO 8 750 in January 2020.)

The Plan:

Start at $0 balance.
Spend until reaching 8% of the credit limit on each card.
Wait for statement balances to be reported to all 3 credit bureaus.
Pay in full.
Go to Step 1.

I'm using the myFICO Ultimate 3B+ subscription ($39.95 monthly) as my primary source for FICO credit scores.

Also using Experian CreditWorks Premium until February. ECP is an excellent service, and I wish TransUnion had something similar.

Lessons Learned / Mistakes Made:

Don't ever pay for monthly credit score updates that are based on Vantage Score 3.0 or TransUnion TransRisk. I did this last year when I was just starting out with the secured loan. A month after starting the loan, these 3 bureau scores were all 650. Apparently, I wouldn't have even had a FICO score until 6 months after 12/7/2017, when the loan was opened. I should have just waited and got the real credit score.
I applied for a store credit card way too soon. I'm not sure exactly what lenders see when they do a hard pull (HP) on someone that just started a credit file (the loan, a month prior), but whatever it is, it's printed on a big red flag. Again, should have waited.
Use a credit score reporting service that has a low cost trial option. Creditchecktotal.com has this for a $1 charge. Experian has a $4.99 first month trial. I use myFICO Ultimate 3B+ monthly reporting now (which is excellent), but in the beginning, when you're just trying to get approved for that first credit card, use one of the trial offers.
When you are about to make the final payment on a 'credit builder'/secured loan from your credit union, actually go in to see someone in person and ask if it can be kept open longer, at less than 8.99% utilization. It turns out I may have been able to keep mine open a few months longer, due to some weird automatic checking deduction payment amount not matching up precisely with the full payoff amount. It's really worth asking about. I just said, "Oh, go ahead and close it with a full payment from my checking right now." That was dumb.
'Pending' charges, as shown by logging in to your card issuers website, CAN (not will, just CAN) show up on a statement balance that is reported to the 3 bureaus. I charged the first month of my myFICO 3B+ subscription on December 31, 2018, and that charge said 'pending' until 2 days after I received Experian alerts to score changes and a balance update showing the $39.95 myFICO charge on a statement balance that was reported on January 2nd.
On my new-to-credit scorecard, there is an additional 4% aggregate utilization threshold. It only gives around 3 to 4 points more for reporting between 0 and 4% total utilization, but it's something. Proof here.
When you only have 2 credit cards, you can get a nice boost on EQ/TU scores by having only 1 report a balance with the other at $0. This is called 'AZEO' (All Zero Except One). It won't affect EX 8 that much - I only got +3pts, but several other EX scores went up around +6pts. EQ 8 +19 / TU 8 +14. Proof of this is here.

Progress report (usually much more detail in my latest replies to this post):

Started with clean credit history on 12/7/2017. (Zero accounts, never a derogatory, no HP's )
1 hard pull (HP) on that date to open a checking account with a local credit union. ('Fair' credit. I only know a Vantage Score 3.0 here: 650 across the board.
Opened checking, savings, and money market accounts. Took out a $500 'credit builder' (secured) loan.
January 23, 2018, hard pull and denied for Target Red Card. (Obviously, short credit history, no revolving account history, stupid to try.)
Continued making monthly payments of $42.35 on the secured loan.
December 4, 2018: (11 payments made on secured loan, but only 10 showing on credit report. myFico 1B report for Transunion. FICO 8 at 666.
December 20, 2018: Decided to try for a credit card from my credit union. This would be my first revolving account on my credit history. I made the final payment (#12) on my secured loan, and they did a HP minutes after that: Transunion FICO 8 728. Approved for $2000CL/15.75% bank-issued Mastercard. Installment loan utilization dropping to 8.47% from 17% combined with all aging values (AoOA, AAoA, AoYA) crossing the 1 year threshold resulted in a +62 point FICO 8 score gain. I thought I had a TU 8 666 walking in there.
December 23, 2018: Signed up for the $1 free trial at creditchecktotal.com . Creditchecktotal.com (FICO 8): 748 EX, 750 EQ, 728 TU . Applied online for a bank-issued Visa card. Approved: $6500 CL/17.24% APR
December 28, 2018: I have a total of 4 HP's on my credit history now. 2 from this past week, 1 over a year ago, and 1 about to hit the 1 year mark in less than 4 weeks. FICO 8 Experian dropped from 748 to 729 due to 1 new inq/HP (was 0 inq at EX). I haven't received either of the 2 new cards yet.
December 31, 2018: Now using myFICO Ultimate 3B+ monthly monitoring. FICO 8 Scores are now: 729 EX, 728 TU, 730 EQ. A 19pt drop on Experian, 20 point drop on Equifax, no drop on TU from the 2 recent hard pulls for the 2 newly approved cards. Installment loan still on report and showing $42 left. No revolving card accounts yet. I just used my new credit union $2000CL Mastercard to pay for the first month of the Ultimate 3B+ subscription.
January 3, 2019: -81 DROP from the secured loan being reported closed. And then, in the same Experian credit alert report, I see a +51 GAIN from one new credit card reporting 2% utilization! I only had the card 3 days! See long reply from me below. Final score after all that is FICO 8 Experian 699. Second card still hasn't arrived in mail. myFICO Ultimate 3B+ monthly hasn't alerted me to any FICO score changes. Today's data is from Experian CreditWorks Premium monitoring, which is spooky fast.
January 4, 2019: Card 2 shows up on Experian report. No change in score, still 699. See my latest reply to this post for a lot of extra EX scores and reasons why adding a second card didn't change my EX score. myFICO Ultimate 3B+ monthly alerted me to an Experian FICO score change: 699. The 'FICO Score 8 Ingredients' for this update do not match with updated information on Experian's current report as of today. For example: "You have no qualifying accounts to calculate your revolving utilization %". Experian's shows 2 revolving, $40 out of $8500 balance, 1% total utilization, etc.
January 5, 2019: myFICO Ultimate 3B+ alert: LOAN PAID. That was the secured loan reporting closed. The FICO 8 Score changes already happened at Experian, ending up at 699 as I updated previously. Also an Equifax update: the paid off loan was reported and Card 1 was added on EQ. EQ FICO 8 Score now 684. Credit Karma alert for Equifax updates: loan paid, and both cards are showing now. More on this in the long form reply/update to this post.
January 6, 2019: Credit Karma alert that Transunion (TU) was updated. +84 point gain. 629 to 713 Vantage Score 3.0. This might actually stick, because it says that the closed loan and 1 new card at $6500 CL is on the report. I still think it's going to drop 35 points or more when the loan closing is factored in. [EDIT: Yep..it did... -41 to 672.] These Vantage Score updates that I post are just for people trying to figure out the scoring methodology.
January 7, 2019: myFICO alert to Transunion updates. 1 card showing there, along with the loan closure. New FICO 8 Score: TU 689.

SearchBots: utilization new to credit score with 2 two cards increase what to expect at 1 one year

Re: The 'All At Just Under 8.99% Utilization' experiment

ridgebackpilot — Fri, 28 Dec 2018 18:51:28 GMT

You must be a scientist; I like your hypothesis-based experiment! Your strategy is almost exactly what I've been doing for several months in a similar experiment of my own.

My approach is a little less complex: I simply assure that all my cards report less than 8.9% utilization each month. I keep track of three monthly dates for each card: Payment due date; statement closing date; and reporting date. Regardless of the due dates, I make sure that all cards are paid down to below 8.9% each month before their statements close. What you do after the statement cuts is immaterial; paying in full won't affect your score. It's the statement amount that they report.

That strategy has resulted in major FICO score increases, which makes sense since 30 percent of your FICO score is determined by amount of debt (utilization). Keep your utilization low and your score will go up.

My file is a lot thicker than yours, but the principle is the same no matter what your history. Good luck and please keep us posted on your experiment!

Re: The 'All At Just Under 8.99% Utilization' experiment

Anonymous — Fri, 28 Dec 2018 18:55:53 GMT

@ridgebackpilot wrote:
My approach is a little less complex: I simply assure that all my cards report less than 8.9% utilization each month. I keep track of three monthly dates for each card: Payment due date; statement closing date; and reporting date. Regardless of the due dates, I make sure that all cards are paid down to below 8.9% each month before their statements close. It's the statement amount that they report.

Oh I'm so glad you replied! I really need to know when the statement balances have been reported, so that I know when I can start spending again. I never want either card issuer (my credit union or Citi) to see a balance above 8% utilization. I know that most people will say this condition is pointless, but I want to see if it has any effect on CLI's.

How do you keep track of the reporting date? Does it work for all 3 bureaus? I don't mind paying for credit score monitoring to make this work - I just want to use the right service for it.

That strategy has resulted in major FICO score increases, which makes sense since 30 percent of your FICO score is determined by amount of debt (utilization). Keep your utilization low and your score will go up.

I've found more than a few posts concerning experiments like ours where someone found that 'Payment History + Low Utilization' was the most important factor, and it didn't matter if one of their cards were used, half the cards were used or all of them were used.

Assuming you were checking your FICO 8 score monthly, how much of an increase did you see each month? Quarterly?

Re: The 'All At Just Under 8.99% Utilization' experiment

ridgebackpilot — Fri, 28 Dec 2018 19:11:20 GMT

Finding out when your statements are cut is relatively easy. Most credit card companies will notify you when your statement is available, and its also noted in your account on their websites. Make note of the statement date as it will be the same each month.

Determining your reporting date with any accuracy is more challenging. You definitely need to subscribe to a free or paid credit monitoring service (like myFICO) that tells you when your cards report. However, it's important to realize that not all of these services give you real-time information. Even myFICO doesn't always report in a timely manner. (Note that Chase will report to the credit bureaus anytime you ask them to, but I believe they're the only bank willing to do that).

Some credit card companies offer free credit monitoring and some of these services report in real-time. For example, with Capital One's CreditWise program, I was notified within moments of a hard pull on my TU report earlier this week. By contrast, myFICO doesn't always report changes in a timely manner. However, their reporting dates seem to be accurate. Just make sure you sign up for a service that gives you information in real-time if you can.

I keep a spreadsheet with dates and balances for each of my cards. That may seem too onerous, but it helps ensure you never miss a payment, you know exactly when your statements close each month, and approximately when each card reports to the credit bureaus.

Re: The 'All At Just Under 8.99% Utilization' experiment

Anonymous — Fri, 28 Dec 2018 19:32:53 GMT

@Anonymous wrote:
@ridgebackpilot wrote:
My approach is a little less complex: I simply assure that all my cards report less than 8.9% utilization each month. I keep track of three monthly dates for each card: Payment due date; statement closing date; and reporting date. Regardless of the due dates, I make sure that all cards are paid down to below 8.9% each month before their statements close. It's the statement amount that they report.
Oh I'm so glad you replied! I really need to know when the statement balances have been reported, so that I know when I can start spending again. I never want either card issuer (my credit union or Citi) to see a balance above 8% utilization. I know that most people will say this condition is pointless, but I want to see if it has any effect on CLI's.

How do you keep track of the reporting date? Does it work for all 3 bureaus? I don't mind paying for credit score monitoring to make this work - I just want to use the right service for it.

That strategy has resulted in major FICO score increases, which makes sense since 30 percent of your FICO score is determined by amount of debt (utilization). Keep your utilization low and your score will go up.
I've found more than a few posts concerning experiments like ours where someone found that 'Payment History + Low Utilization' was the most important factor, and it didn't matter if one of their cards were used, half the cards were used or all of them were used.

Assuming you were checking your FICO 8 score monthly, how much of an increase did you see each month? Quarterly?

With the exception of a few outliers like U.S. Bank and Elan Financial Services (owned by U.S. Bank), most card issuers report to the credit reporting agencies on the same date the statement closes. Citi's Statement Close date is usually 4 days after the Payment Due date, and their reporting date is the same as the Statement Close date.

Re: The 'All At Just Under 8.99% Utilization' experiment

Anonymous — Fri, 28 Dec 2018 21:44:16 GMT

@Anonymous wrote:
With the exception of a few outliers like U.S. Bank and Elan Financial Services (owned by U.S. Bank), most card issuers report to the credit reporting agencies on the same date the statement closes. Citi's Statement Close date is usually 4 days after the Payment Due date, and their reporting date is the same as the Statement Close date.

Thank you for that Citi info. I probably won't have the card until next week, so I can't sign in to the card services portal yet.

I naturally assume that all banks and computer programs are non-deterministic entities that should never be trusted (lol), so I'm looking for a way to find out if/when that statement closing balance has been included in my credit report. I mean, Citi could 'report' it and that date is easy enough to find out, but when does it actually get merged into my credit file? With all the reports these bureaus receive, I find it hard to believe they all do it instantly.

Re: The 'All At Just Under 8.99% Utilization' experiment

Anonymous — Fri, 28 Dec 2018 22:01:14 GMT

@ridgebackpilot wrote:
Determining your reporting date with any accuracy is more challenging. You definitely need to subscribe to a free or paid credit monitoring service (like myFICO) that tells you when your cards report. However, it's important to realize that not all of these services give you real-time information. Even myFICO doesn't always report in a timely manner.

I think will just start using the myFICO Ultimate 3B+ at $39.95 monthly.

Some credit card companies offer free credit monitoring and some of these services report in real-time. For example, with Capital One's CreditWise program, I was notified within moments of a hard pull on my TU report earlier this week. By contrast, myFICO doesn't always report changes in a timely manner. However, their reporting dates seem to be accurate.

I was at my credit union when they did a hard pull right in front of me and within minutes I got a notification of that from Credit Karma. Thanks for the info on myFICO.

I keep a spreadsheet with dates and balances for each of my cards. That may seem too onerous, but it helps ensure you never miss a payment, you know exactly when your statements close each month, and approximately when each card reports to the credit bureaus.

Too onerous? lol I set up a Microsoft Flow template in Office 365 already for mobile push notifications of important dates and email received from either my credit union or Citi. I already made the Excel sheet with chart ready to go.

You should make a post with some of your findings! I'm sure your data points would help a lot of people.

Re: The 'All At Just Under 8.99% Utilization' experiment

Anonymous — Fri, 28 Dec 2018 22:12:01 GMT

@Anonymous wrote:
@Anonymous wrote:
With the exception of a few outliers like U.S. Bank and Elan Financial Services (owned by U.S. Bank), most card issuers report to the credit reporting agencies on the same date the statement closes. Citi's Statement Close date is usually 4 days after the Payment Due date, and their reporting date is the same as the Statement Close date.
Thank you for that Citi info. I probably won't have the card until next week, so I can't sign in to the card services portal yet.

I naturally assume that all banks and computer programs are non-deterministic entities that should never be trusted (lol), so I'm looking for a way to find out if/when that statement closing balance has been included in my credit report. I mean, Citi could 'report' it and that date is easy enough to find out, but when does it actually get merged into my credit file? With all the reports these bureaus receive, I find it hard to believe they all do it instantly.

My experience is that Experian is the quickest to update their files, followed by Equifax, with TransUnion being the slowest. All three CRAs update their files at midnight Pacific Time. So, for example, if Citi closes a statement on 12/25 and sends the information the CRAs, Experian would display the updated info at 12:01 a.m. on 12/27, Equifax about 2-3 days later, and TransUnion about 5 days later. I've also noticed that it varies if there's an intervening weekend. Your experience may vary from that though.

Re: The 'All At Just Under 8.99% Utilization' experiment

Anonymous — Fri, 28 Dec 2018 22:54:26 GMT

@Anonymous wrote:
My experience is that Experian is the quickest to update their files, followed by Equifax, with TransUnion being the slowest. All three CRAs update their files at midnight Pacific Time. So, for example, if Citi closes a statement on 12/25 and sends the information the CRAs, Experian would display the updated info at 12:01 a.m. on 12/27, Equifax about 2-3 days later, and TransUnion about 5 days later. I've also noticed that it varies if there's an intervening weekend. Your experience may vary from that though.

Thank you - that is very helpful!

Re: The 'All At Just Under 8.99% Utilization' experiment

Anonymous — Fri, 28 Dec 2018 23:07:09 GMT

@Anonymous wrote:
For the first 12 billing cycles on my 2 new credit cards, I am going to have them both report their utilization ratios at 8% before paying them in full. (2000/6500 cl's, 160/520 (8%) self-imposed spending limits.)

Hypothesis: Excellent payment history and a reported maximum credit utilization of just under 8.99% for 12 contiguous billing cycles on 100% of only 2 cards, with no other credit accounts, will change my FICO 8 score from 'good' to 'excellent' range.

The Plan:
Start at $0 balance.
Spend until reaching 8% of the credit limit on each card.
Wait for statement balances to be reported to all 3 credit bureaus.
Pay in full.
Go to Step 1.
The big question: Is there a way to know exactly when all 3 bureaus have that updated balance?

Would the myFico Ultimate 3B+ at $39.95 monthly show me this?
Credit profile info:
Started with clean credit history on 12/7/2017. (Zero accounts, never a derogatory, no HP's )
1 hard pull (HP) on that date to open a checking account with a local credit union. ('Fair' credit. I only know a Vantage Score 3.0 here: 650 across the board.
Opened checking, savings, and money market accounts. Took out a $500 'credit builder' (secured) loan.
January 23, 2018, hard pull and denied for Target Red Card. (Obviously, short credit history, no revolving account history, stupid to try.)
Continued making monthly payments of $42.35 on the secured loan.
December 4, 2018: (11 payments made on secured loan, but only 10 showing on credit report. myFico 1B report for Transunion. FICO 8 at 666.
December 20, 2018: Decided to try for a credit card from my credit union. This would be my first revolving account on my credit history. I made the final payment (#12) on my secured loan, and they did a HP minutes after that: Transunion FICO 8 728. Approved for $2000CL/15.75% Mastercard. (Installment loan utilization dropped to 8.47% from 17%, +60 point FICO 8 score gain.)
December 23, 2018: Signed up for the $1 free trial at creditchecktotal.com . Creditchecktotal.com (FICO 8): 748 EX, 750 EQ, 728 TU . Applied online for Costco Anywhere Visa Card by Citi. Approved: $6500 CL/17.24% APR
December 28, 2018 (Today): I have a total of 4 HP's on my credit history now. 2 From a week ago, 1 over a year ago, and 1 about to hit the 1 year mark in less than 4 weeks. FICO 8 Experian dropped from 748 to 729 due to the 2 new HP's. I haven't received either of the 2 new cards yet.

#2 of your plan doesn't make sense to me. Its quite possible to spend up to 100% of your credit limit in any given month, then pay down the balance by reporting date so the lender only reports a small (< 8.9%) balance. Limiting your spend to 8% of your card limit, especially if you'll spend cash in excess of that amount, is a sub-optimal strategy when you can always make multiple payments during the month to pay down your card balance and optimize the balance reported by the lender. There's no rule that says you can only make one payment per month.

I don't intend to rain on your parade but I doubt you will move to Excellent (defined as a FICO score > 800) on all three CRAs in one year. FICO scores are essentially logarithmic so it becomes more difficult to increase scores rapidly once you're above a 700 score. Not to mention you have a loan that will be reported as paid, and two new credit accounts. All three events will negatively affect your score and with a thin profile the effects are magnified. The loss of the loan affects your credit mix (10% of FICO score), and the two new accounts will temporarily decrease your score because they initially represent increased risk.

Re: The 'All At Just Under 8.99% Utilization' experiment

Anonymous — Fri, 28 Dec 2018 23:46:31 GMT

@Anonymous wrote:
#2 of your plan doesn't make sense to me. Its quite possible to spend up to 100% of your credit limit in any given month, then pay down the balance by reporting date so the lender only reports a small (< 8.9%) balance.

Yes, I am aware, primarily due to posts from people like yourself on these forums!

I don't need the extra spending limit from these credit cards at all really. What I do need is a way to prove that I am fiscally responsible and always pay my bills on time. At $68,000 salary, saving for a down payment on a house, I couldn't even put that much on credit cards anyway.

I don't intend to rain on your parade but I doubt you will move to Excellent (defined as a FICO score > 800) on all three CRAs in one year. FICO scores are essentially logarithmic so it becomes more difficult to increase scores rapidly once you're above a 700 score. Not to mention you have a loan that will be reported as paid, and two new credit accounts. All three events will negatively affect your score and with a thin profile the effects are magnified. The loss of the loan affects your credit mix (10% of FICO score), and the two new accounts will temporarily decrease your score because they initially represent increased risk.

I don't believe it either! I highly doubt it will work, but I do believe sticking to the plan will only have positive impact. I'll have 2 years of perfect payment history by the time I apply for a new auto loan, assuming I even apply for one next year. (My current car is paid off, and each month I keep it means another $400 I put into my Vanguard index fund.)

Re: The 'All At Just Under 8.99% Utilization' experiment

Anonymous — Sat, 29 Dec 2018 00:11:48 GMT

@Anonymous wrote:

I don't need the extra spending limit from these credit cards at all really. What I do need is a way to prove that I am fiscally responsible and always pay my bills on time. At $68,000 salary, saving for a down payment on a house, I couldn't even put that much on credit cards anyway.
I don't believe it either! I highly doubt it will work, but I do believe sticking to the plan will only have positive impact. I'll have 2 years of perfect payment history by the time I apply for a new auto loan, assuming I even apply for one next year. (My current car is paid off, and each month I keep it means another $400 I put into my Vanguard index fund.)

Understood; but perhaps this is an opportunity to put all your normal spending on credit cards in order to get rewards like cashback or points.

It wasn't my intention to be critical so if I came across as such I apologize; I'm simply attempting to temper expectations. The people you tend to see with rapid increases in their FICO scores generally have had delinquencies/derogatories removed from their credit reports. Your scores could easily fall to 720 or less when the closed loan and the 2 new credit accounts hit your credit report. Then you'll be fighting uphill all year to hit 800 since one can only reasonably expect to see a 4-7 point increase in scores each month. Perhaps one option is to get another credit builder/share secured loan and immediately pay it down to <8.9%; that would certainly offset the loss of the first loan. The trick would be to find a lender that will allow the term of the loan to continue even if its paid down immediately.

Re: The 'All At Just Under 8.99% Utilization' experiment

Anonymous — Sat, 29 Dec 2018 01:53:54 GMT

@Anonymous wrote:
Understood; but perhaps this is an opportunity to put all your normal spending on credit cards in order to get rewards like cashback or points.

That's exactly how I plan to use these 2 cards - for non-discretionary expenses first. Minus my rent, which I can't pay by credit card, I still couldn't put enough on there to make a huge difference. It would be something like $18,000 a year with a 1%/2%/4% cash back mix. I could maybe see $500 rewards back if I did that.

It wasn't my intention to be critical so if I came across as such I apologize; I'm simply attempting to temper expectations.

Oh no, I didn't take it that way at all! The only expectation I have from this little experiment is that my FICO 8 score will recover from the upcoming negatives to at least as good as the highest it has ever been - when utilization dropped from 17% to 8.47% on that secured loan.

But, maybe....just maybe....I might win that lottery (hypothesis).

The people you tend to see with rapid increases in their FICO scores generally have had delinquencies/derogatories removed from their credit reports.

You have now just seen someone with no derogatories - ever, not even if credit reports went back to elementary school - and a clean credit report with not even one HP or account on it, achieve a +62 point gain on their FICO 8 score. I had no clue it was going to happen like that from a secured loan. I was bracing myself for denial when I walked into my credit union to apply for my first credit card.

Your scores could easily fall to 720 or less when the closed loan and the 2 new credit accounts hit your credit report. Then you'll be fighting uphill all year to hit 800 since one can only reasonably expect to see a 4-7 point increase in scores each month.

I'll be updating this thread with the scores as I see them drop. My Experian 748 already dropped 19 points to 729 from the 2 HP's over the last week. I'm anxious to see the drop from the paid off secured loan, which should happen by next Friday at the latest. Until those 2 new cards start reporting, I'm going to have zero open accounts and 2 new HP's, so that score should be sufficiently frightening to see for a while.

Re: The 'All At Just Under 8.99% Utilization' experiment

NRB525 — Sat, 29 Dec 2018 02:47:32 GMT

OP congrats on your new cards.

I would suggest you may be over thinking the next few months

It is an interesting experiment but of course Utilization has no memory so all that effort each month won’t necessarily help with the score in December 2019. What will help is always paying on time

Where are your scores coming from? You mention a CK alert about the INQ. Are your updated scores from CK?

I use the MyFICO monitoring, the quarterly 3B version and the regular updates and identity theft monitoring goes with it. It will be interesting to see your progress reports.

Re: The 'All At Just Under 8.99% Utilization' experiment

Anonymous — Sat, 29 Dec 2018 03:17:11 GMT

@NRB525 wrote:
OP congrats on your new cards.
I would suggest you may be over thinking the next few months

Thank you. And yes, I am. lol

Where are your scores coming from? You mention a CK alert about the INQ. Are your updated scores from CK?

From a myFICO 1B report, and creditchecktotal.com. (It's listed there in the original post.) I only mentioned the CK alert because it's free and alerts fairly quickly to hard pulls - within minutes as I found out while at my credit union.

I'll still post those Vantage Score 3.0's from there anyway, just to compare to the FICO 8 scores. I've noticed that Vantage Score 3.0 really doesn't like it if you have no revolving accounts, whereas the FICO 8 score went up dramatically with just 1 installment loan at 8.47% utilization. I have a feeling my Vantage score is going to drop below 600 soon, because the new revolving accounts won't show up for quite a while.

For the next few months, I won't even be able to get approval for a CVS card.

I use the MyFICO monitoring, the quarterly 3B version and the regular updates and identity theft monitoring goes with it. It will be interesting to see your progress reports.

I think that's my best option as well. I need the monthly updates from the 3B+ to really make this worthwhile. I think I'll start it next week. It's going to be a while before the new cards start reporting.

Re: The 'All At Just Under 8.99% Utilization' experiment

Anonymous — Tue, 01 Jan 2019 00:24:00 GMT

[UPDATE] December 31, 2018:

Now using myFICO Ultimate 3B+ monthly monitoring.
FICO 8 Scores are now: 729 EX, 728 TU, 730 EQ.
A 19pt drop on Experian, 20 point drop on Equifax, no drop on TU from the 2 recent hard pulls for the 2 newly approved cards.
Installment loan still on report and showing $42 left. No revolving card accounts showing yet.
I just used my new credit union $2000CL Mastercard to pay for the first month of the Ultimate 3B+ subscription.
That $39.95 charge was the first time in my life that I ever used my own credit card to pay for something. No change in vitals.

Re: The 'All At Just Under 8.99% Utilization' experiment

Anonymous — Fri, 04 Jan 2019 02:28:49 GMT

[UPDATE: January 3, 2019]

[This is all Experian data from Experian Creditworks Premium - FICO 8 Scores.]

Starting score with 1 secured loan, 1 HP, no revolving accounts, AoOA 1 year, no derogatories, no public records:
EX 729

All the following changes happened today, January 3, 2019 (new credit alerts from Experian):

-81 point drop to 648: My only open account, a secured loan, reported closed.
- 'What's hurting your score?': No Loan Activity, Few Accounts Paid on Time, Short Account History, No Revolving Activity
+51 point gain to 699: My new credit union Mastercard reported a statement balance of $40 out of a $2000 credit limit. 2% utilization. Already paid it online. (Shows as 'Very Good' on 'Amount of Debt'. Experian's report says: "Ideal usage is 6% or less.")
- 'What's hurting your score?': Short account history, Short revolving history, Few accounts paid on time

I activated my new card only 3 days ago, and already received a statement balance email last night on January 2nd. Also, Experian's credit report shows that this card was opened on December 1st, 2018. I first applied for it on Dec 20 and received it in mail on Dec 31. Made $39.95 charge on it that night. I'm amazed Experian picked up the new card activity so quick!

So contrary to popular opinion that told me I was going to experience nothing but negatives from a loan closure and a new credit card, I have survived the apocalypse and ended up with a 'Good' credit rating.

Experian FICO 8 699 Report:

Payment History: Very Good

Late Payments: 0
Collections: 0
Negative Public Records: 0

Amount of Debt: Very Good

Revolving utilization: 2%
Accounts with Balances: 1
Revolving account Balance: $40

Credit History Length: Poor

Average Age: 7 mos
Oldest Account: 1 yr 1 mo ( The closed loan still counts here.)

Amount of New Credit: Good

Latest Open Account: 1 mo
Inquiries in Last Year: 1

Credit Mix: Good

Revolving Accounts: Yes
Bank-Issued Credit Card Accounts: Yes
Installment Loans, Including Mortgages: Yes

Re: The 'All At Just Under 8.99% Utilization' experiment

Anonymous — Fri, 04 Jan 2019 20:05:03 GMT

[UPDATE: January 4, 2019]

EX 699
EQ 684 [From 750, after loan closure and with 1 of 2 cards showing]
TU 728

Second card now showing at Experian. No change in score. See below.
First card now showing at Equifax. EQ is late to the party, but took the time to call.
No cards showing at Transunion. TU still has the open loan on it. TU is like that person who is really late to the party and doesn't even bother to make a call, so you wonder if they got into an accident or something.

I'm posting the updated Experian report from this morning, which is now showing 2 cards with a 2% utilization on Card 1, ZERO on Card 2 - combined credit limit $8500. (2000 and 6500 respectively)

AAoA has changed with Card 2 now on report: 5 mos
AoOA: 1 yr 1 mos

EX FICO 8: 699 (Didn't move. CL from $2000 to $8500 across 2 cards now.)
'Amount of New Credit' has changed from Good to Fair, moving from 1 revolving to 2 revolving this morning.
'Credit Mix' changed from Good to Very Good, moving from 1 revolving to 2 revolving this morning.
'Length of Credit History' = POOR. Nothing I can do about this one.

EX FICO 2 is now 727. The second - and final - card showed up this morning on EX. (I haven't even received this card in the mail yet.)
(Short account history, Short Revolving History, Accounts With Balances (1 @ 2% UTIL, 1 @ ZERO), Many New Accounts)
EX FICO Auto Score 8: 683
(Short account history, Short Revolving History, No Loan Activity, Few Accounts Paid on Time)
EX FICO Auto Score 2: 703
(Short account history, Short Revolving History, No Loan Activity, Accounts with Balances ($40 out of $8500)
EX FICO BankCard Score 8: 703
(Short account history, Short Revolving History, No Loan Activity, Few Accounts Paid on Time)
EX FICO BankCard Score 2: 732(Short account history, Short Revolving History, Accounts With Balances, Many New Accounts)
EX FICO 3: 712(Short account history, Short Revolving History, Accounts with Balances, Seeking Credit)

Re: The 'All At Just Under 8.99% Utilization' experiment

NRB525 — Sat, 05 Jan 2019 20:30:40 GMT

Good updates. Your score is on a roller coaster as these accounts change out.

It will be interesting to see the development of the scores as things stabilize.

What is your apping plans / new account plans for the next few months?

Re: The 'All At Just Under 8.99% Utilization' experiment

Anonymous — Sat, 05 Jan 2019 21:44:06 GMT

@NRB525 wrote:
Good updates. Your score is on a roller coaster as these accounts change out.
It will be interesting to see the development of the scores as things stabilize.

I've been getting updates from Experian, myFICO and Credit Karma today. I'm just waiting until later to collate those changes.

Experian is now stable at 699, and won't change again until February 1st or 2nd, I am guessing. It will show score changes from 6.75% utilization on Card 1 ($135 on card now, old $40 balance paid in full, done with this card until next billing cycle), and 7-8% utilization on Card 2 (Depends on if I can charge exactly $520 to Card 2...probably will come in under 8%.)

I'm most interested in Transunion. My credit union uses TU exclusively for everything. In the future, I will get my auto and home loans through them.

What is your apping plans / new account plans for the next few months?

No plans for the next 12 months. Besides, with these scores and seriously short 5 months average age of accounts (AAoA - for anyone new to the forums), I doubt I'd get approved for anything anyway. And if they did, they need their head examined, because with my income and non-discretionary expenses, plus saving for retirement and a new home, I surely won't be needing any 'frequent flyer miles'. lol

One of the many reasons I am doing this experiment is to see if having only 2 credit cards is 'good enough' for someone with middle class income. I see that question asked a lot on the internet.