topic Re: Consumer Finance Accounts in Understanding FICO® Scoring

Consumer Finance Accounts

MissLiz — Thu, 06 Jun 2024 14:39:36 GMT

Do we have any DP's about how badly having a CFA on your CR can affect your score? I had a (positive) Affirm account pop up that changed my AoYA, but now that I've joined the forum, I see that CFA's, even positive ones have a negative effect. I don't know why I didn't expect it to report, but it did take me by surprise.

Lesson learned. No more pay in installments for me.

Re: Consumer Finance Accounts

SouthJamaica — Thu, 06 Jun 2024 12:29:45 GMT

@MissLiz wrote:
Do we have any DP's about badly having a CFA on your CR can affect your score? I had a (positive) Affirm account pop up that changed my AoYA, but now that I've joined the forum, I see that CFA's, even positive ones have a negative effect. I don't know why I didn't expect it to report, but it did take me by surprise.

Lesson learned. No more pay in installments for me.

It's guesswork, but here are a few threads wrestling with that question:

https://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/Attempting-to-isolate-CFA-point-loss/m-p/6712248

https://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/How-bad-are-consumer-finance-accounts-really/td-p/6364567

Re: Consumer Finance Accounts

MissLiz — Thu, 06 Jun 2024 12:58:20 GMT

@SouthJamaica Thank you! I read all the messages on both threads then promptly paid off my Affirm.

My ten year clock starts ticking now!

Re: Consumer Finance Accounts

FlaDude — Thu, 06 Jun 2024 14:24:36 GMT

Is it shown anywhere which accounts are considered CFAs? I have the "too many CFA" reason code on some of my scores (from Extra Credit/credit.com), and assume they are from one or more of these: Service Finance, Prosper, Marcus, Lending Club. They are all closed but won't drop off my reports until 2029-2031, except for Marcus which for some reason has already dropped off even though I got it around the same time as the Prosper and Lending club loans.

Re: Consumer Finance Accounts

MissLiz — Thu, 06 Jun 2024 14:38:24 GMT

@FlaDude I checked myFICO 3B reports and Affirm is only reporting on EX, but I couldn't find CFA listed anywhere. Account type says "other," so I logged into my EX to view report and couldn't find it either. I can't pull my weekly annualcreditreport.com until tomorrow, so I'll see if I can find it listed there and report back.

Re: Consumer Finance Accounts

FlaDude — Thu, 06 Jun 2024 14:47:55 GMT

@MissLiz wrote:
@FlaDude I checked myFICO 3B reports and Affirm is only reporting on EX, but I couldn't find CFA listed anywhere. Account type says "other," so I logged into my EX to view report and couldn't find it either. I can't pull my weekly annualcreditreport.com until tomorrow, so I'll see if I can find it listed there and report back.

I just pulled all three of my reports from annualcreditreport.com and I don't see any obvious indicator.

Re: Consumer Finance Accounts

MissLiz — Thu, 06 Jun 2024 14:55:02 GMT

@FlaDude wrote:

I just pulled all three of my reports from annualcreditreport.com and I don't see any obvious indicator.

Weird. You would think it would be there of all places. Hopefully someone with more knowledge on the subject will chime in.

Re: Consumer Finance Accounts

pizzadude — Thu, 06 Jun 2024 14:55:52 GMT

Unfortunately there are no account identifiers or notations which allow you to identify which accounts on your reports are considered CFAs.

The only way to know they're present is through the FICO scoring reasons that will mention the presence of a consumer finance account.

Re: Consumer Finance Accounts

MissLiz — Thu, 06 Jun 2024 15:01:21 GMT

@pizzadude Oof. I don't like that they can see something I don't see.

Re: Consumer Finance Accounts

SouthJamaica — Thu, 06 Jun 2024 15:13:32 GMT

@FlaDude wrote:
Is it shown anywhere which accounts are considered CFAs? I have the "too many CFA" reason code on some of my scores (from Extra Credit/credit.com), and assume they are from one or more of these: Service Finance, Prosper, Marcus, Lending Club. They are all closed but won't drop off my reports until 2029-2031, except for Marcus which for some reason has already dropped off even though I got it around the same time as the Prosper and Lending club loans.

All 3 of them might well be CFA's. There are conflicting reports in the forum.

Here it's said that Prosper and Lending Club are considered CFA's: https://ficoforums.myfico.com/t5/Personal-Finance/Master-list-of-providers-products-that-are-flagged-as-CFA-s/m-p/6398084#M236602

I've never heard of "Service Finance".

Re: Consumer Finance Accounts

FlaDude — Thu, 06 Jun 2024 15:54:16 GMT

@SouthJamaica wrote:
I've never heard of "Service Finance".

They finance home repairs, in our case a new central AC. It's been paid off for over 5 years, but has another 5 before it drops off.

Re: Consumer Finance Accounts

md_rebuild — Thu, 06 Jun 2024 17:43:00 GMT

I was wondering the same thing. I had 2 Best Egg finance loans (about $10K total - from 2 years ago) that I just decided to pay off. They haven't reported to the bureaus yet, but I am curious about the impact on my score (since I paid them off) and also what the impact will be as they age.

Re: Consumer Finance Accounts

MissLiz — Thu, 06 Jun 2024 17:50:24 GMT

@md_rebuild If they haven't reported to the bureau's in the past two years, hopefully they won't report when you pay them off. Keep us posted!

Re: Consumer Finance Accounts

SouthJamaica — Thu, 06 Jun 2024 18:07:19 GMT

@FlaDude wrote:
@SouthJamaica wrote:
I've never heard of "Service Finance".
They finance home repairs, in our case a new central AC. It's been paid off for over 5 years, but has another 5 before it drops off.

Well it certainly sounds like the type of account that would be classified as a CFA.

Re: Consumer Finance Accounts

md_rebuild — Thu, 06 Jun 2024 18:10:32 GMT

@MissLiz Sorry, just now realize that my 1st post wasn't clear. They posted to the bureaus when I establshed them. I am wondering what (if any) score change will occur with them being paid off (and my overall debt dropping by 1/3) and then what will happen when they age off completely (10 years!).

I've learned my lesson on CFAs. As I previously mentioned on antoher thread I love going to baseball games, getting good seats, and then just paying them off over time. I had no idea that every time I did that through StubHub, using Affirm, each one was going to show up as a CFA!

Re: Consumer Finance Accounts

MissLiz — Thu, 06 Jun 2024 19:11:48 GMT

@md_rebuild Oh, I see! At least you know that when they report paid off, the ten year clock starts until they're gone. The DP's are all over the place as to how damaging (or not) they may be. I *think* they count as an installment loan, so if you don't have any others, it may effect your credit mix score, and if you do, it may effect your overall utilization once closed.

Again, I'm no expert, but it feels like paying off these loans would trigger a score increase.

Re: Consumer Finance Accounts

AzCreditGuy — Fri, 07 Jun 2024 18:21:04 GMT

@MissLiz wrote:
@md_rebuild Oh, I see! At least you know that when they report paid off, the ten year clock starts until they're gone. The DP's are all over the place as to how damaging (or not) they may be. I *think* they count as an installment loan, so if you don't have any others, it may effect your credit mix score, and if you do, it may effect your overall utilization once closed.

Again, I'm no expert, but it feels like paying off these loans would trigger a score increase.

No they dont as they are seen a negative, the funny thing is when you have the CFA loan its a postive in pts, and when I paid my off, my score went down

Re: Consumer Finance Accounts

MissLiz — Sat, 08 Jun 2024 13:25:18 GMT

@AzCreditGuy That's interesting! We will see if my score drops after Affirm posts the paid off account. It'll be a month or more before that happens as I've just paid it off, but I will come back and update.

Re: Consumer Finance Accounts

TrapLine — Sat, 08 Jun 2024 13:48:17 GMT

The mention of conflicting reports is scary.

In my travels at one time Citi One Main tossed a CFA and I had a Wells Fargo credit card (can't remember the details) years back issued outside the normal channels and it had a CFA. At the time I had no clue until reading on the MF Forum. Those cards are long gone now but once I better understood things, I stay away from anything but known main stream credit.

After the big meltdown long in the past I do not want lingering problems. Note, something else that bothers me is institutional memory. That is, just because our credit reports are clean does not mean the financials did not save the past. Example is Citi Bank who will not let go of the past and they were the first real bank credit card issued after the big BK (it took eight years to get a main stream regular credit card after the big BK years back for me). Un real!

Re: Consumer Finance Accounts

AzCreditGuy — Sat, 08 Jun 2024 17:22:03 GMT

@MissLiz wrote:
@AzCreditGuy That's interesting! We will see if my score drops after Affirm posts the paid off account. It'll be a month or more before that happens as I've just paid it off, but I will come back and update.

@MissLiz Well I can already tell you that your score will drop. You no longer have a loan, so you will penalized for that and than the CFA code will pop up as well, another ding. Diff lets us know how much for a drop