topic Re: experian reporting HELOC as revolving in Understanding FICO® Scoring

experian reporting HELOC as revolving

Anonymous — Wed, 30 Apr 2008 14:25:06 GMT

Hi. I just pulled my exerian cr and it is showing my HELOC balance of $49K as revolving credit. Equifax is showing the same amount as Mortgage. Which is correct? Should I take out another $1K to make sure the balance is over $50k. I'm trying to lease two new cars and I'd rather increase my balance a little to make sure it is being reported correctly.

Re: experian reporting HELOC as revolving

Anonymous — Wed, 30 Apr 2008 15:24:31 GMT

The actual $ amount for HELOC's to be ignored in revolving UTL is unknown- 50K for sure.

EXP will still list this as revolving- it just won't count in UTL. if you do not have before and after scores- it is imposible to tell.

I would increase the CL to 50K -

drmike0422 wrote:

Hi. I just pulled my exerian cr and it is showing my HELOC balance of $49K as revolving credit. Equifax is showing the same amount as Mortgage. Which is correct? Should I take out another $1K to make sure the balance is over $50k. I'm trying to lease two new cars and I'd rather increase my balance a little to make sure it is being reported correctly.

Re: experian reporting HELOC as revolving

MidnightVoice — Wed, 30 Apr 2008 15:28:57 GMT

drmike0422 wrote:
Hi. I just pulled my exerian cr and it is showing my HELOC balance of $49K as revolving credit. Equifax is showing the same amount as Mortgage. Which is correct? Should I take out another $1K to make sure the balance is over $50k. I'm trying to lease two new cars and I'd rather increase my balance a little to make sure it is being reported correctly.

I have a Heloc as revolving, and only on EX. It tanks my EX score by 40-50 points.

And I have been unable to change it

Re: experian reporting HELOC as revolving

Anonymous — Wed, 30 Apr 2008 17:24:00 GMT

Thanks. I'll increae my balance a little just to be sure.

Re: experian reporting HELOC as revolving

Lel — Thu, 01 May 2008 05:03:00 GMT

@Anonymous wrote:
Hi. I just pulled my exerian cr and it is showing my HELOC balance of $49K as revolving credit. Equifax is showing the same amount as Mortgage. Which is correct? Should I take out another $1K to make sure the balance is over $50k. I'm trying to lease two new cars and I'd rather increase my balance a little to make sure it is being reported correctly.

I've been doing a lot a research about HELOCs and how they affect one's credit score. From what I gather, this is what I understand:

1. HELOCs will usually report as revolving credit, regardless of the amount. Some lenders do report them as installment loans, but many do not.
2. However, HELOCs with limits above a certain threshold, though still reported as revolving credit, will be treated as installment loans in the FICO scoring model.
3. This threshold has never been clearly stated, but it appears to be around $50,000.
4. It's not the balance that you carry, but the size of the credit line. So, if you have a HELOC with a $100,000 limit with a balance of $45,000, it should still be treated as an installment loan (in theory).
5. Increasing one's balance on a HELOC does not mean that it will become classified as an installment loan.
6. None of the first five points is set in stone.

Other people with HELOCs have reported that even though their lines are maxed out, this isn't reflected in their utilization. You'll have to check your credit report to see if this is the case for you.

Here's a link to a recent article in which Craig Watts of Fair Isaac describes how HELOCs are theoretically scored.

http://biz.yahoo.com/brn/080424/24968.html?.v=1

Discussion?

Re: experian reporting HELOC as revolving

haulingthescoreup — Sat, 03 May 2008 00:47:37 GMT

Thank you, you have summarized my experience exactly!

I have a $50K HELOC, and back when my credit was simple, I could see very clearly that it did not matter what the balance was on it: there was no impact on my scores, and no impact on the reported utilization that is displayed on screen two of the various FICO score reports.

Things have gotten murkier after acquiring a bunch of new credit recently, and on TU, my util is showing much higher, making it look as if they are now treating the HELOC as revolving. But the math isn't exactly right, and my TU score is right in line with the other two, so I think that this is one of those weird freaky displays that we get sometimes.

As best as I can tell, my HELOC has always been treated as installment, no matter what the util on it might be. From various posts, it looks like a $40K CL might be enough, but a $50K and above definitely is. MV's CL is lower ($30K? can't remember), and EX alone treats it as revolving, which is definitely not good for his EX score. I think that netpanther had the same experience.

The moral of the story appears to be, if you're going to get a HELOC, try to get a credit limit of at least $50K, to avoid util hell.

Re: experian reporting HELOC as revolving

Anonymous — Sat, 03 May 2008 03:32:33 GMT

For the record-

My 50K heloc is not treated as installment- it is ignored completly-

I had pulled scores the same week prior to my HELOC reporting- and the day it reported- ZERO point change.