topic Re: Frustrating score changes in Understanding FICO® Scoring

Frustrating score changes

MrsCHX — Sat, 10 May 2025 16:51:11 GMT

I know, I know, getting out of debt >>> scores. I'll have all my credit card debt paid in full by September.

But, seeing +0 for paying off $1k of debt but -5 for a $111 balance reporting on a card is infuriating lol!!

I bought something for my grandson and no biggie, went to pay in full but the payment did not post to Amazon before the statement cut. So I know it's related to util but still, annoying!!

Re: Frustrating score changes

Thomas_Thumb — Sat, 10 May 2025 21:48:09 GMT

Unfortunately that amount posting on the Amazon card took card utilization to 31.7% - over the 29% level that can result in assessment of penalty. If it was any other card, the card UT would be well below 29% and likely no point loss.

Re: Frustrating score changes

Anonymous — Sun, 11 May 2025 09:48:40 GMT

I'm a proponent for a higher type of credit line total. You can have many cards, and while each card does factor into a utlization score individually, your overall utilization will also factor into a FICO score.

Here on FICO you can see this first hand in your report, even on creditkarma (I know), and other places, they still tally your credit utilization as a whole - and that's simply for a visual available to you. Whether that's used as a component of the algorithm no one really knows, but you can speculate.

As an example, if you owe $5000, on a $5000 card and that's all you have at your disposal, that's bad. If you owe that same $5000 on a $10000 credit card total (across all your credit cards), that's still bad. But, if you owe $5000 across a grand total of $500,000 in credit line totals, you are realisitically only using 1% of your total credit line, even if that one card among many, is grossly over ultilized. That all factors into the utilization score. For those that don't think it's true, I stand a bit of in disagreement. People have been in this situation and scores barely flinched.

By this logic, someone holding $500k or even one million in credit line totals, can be roaded by something as simple as a Home Depot card. Using the $4000-$5000 balance they give you, and you spending it on one single home project. Not unlikely, but it blows the utilization score out of the water on the individual card, but overall utilization still remains less than 1%. It would otherwise suggest, these meager cards could take down a WELL defined and thick profile, for many points. I know this isn't true, others know this isn't true. FICO scores won't likely reflect this when dealing with significant credit line totals.

I have an in-law that likes to keep credit cards low, likes to keep totals low. Stouts his 830+ FICO score, but low credit line total in the grand scheme. We hold much in lines, playing it well, last FICO scores bounce between 829-844. The only difference, is utilization scores never matter in our world. We can't spend enough, and still repay on it, to even matter. It helps to minimize or eliminate the impact of utilization.

My suggesting is to up your credit totals a bit, where utilization will matter less. You are already doing the credit thing responsibly.

Re: Frustrating score changes

Thomas_Thumb — Sun, 11 May 2025 22:13:32 GMT

The OP has nearly $28k in total CL. The $1k paydown represents about 3.5% in aggregate utilization. Likely no score boost because no aggregate UT threshold was crossed.

Highest UT for individual cards is an important scoring metric. Two known thresholds that can affect score are 29% and 49% although some use 30% and 50%.

The $111 balance is insignificant regarding impact on total (aggregate UT). It is significant for low limit individual cards. I'd suggest the OP focus on increasing CL of low limit cards to $1k so reporting of a couple hundred dollars on such cards won't affect score.

Total CL should be a secondary consideration. In fact, the modest total CL can provide a guard rail against excessive spending.

Re: Frustrating score changes

MrsCHX — Sun, 11 May 2025 20:23:01 GMT

Ah!!! I hadn't considered that -- that the overall reduction isn't as impactful, yet. And the $111 reporting on a $350 balances crossed a threshold.

im waiting for a different card to update because it was at 92% and is now at 42%.

Re: Frustrating score changes

Thomas_Thumb — Sun, 11 May 2025 22:35:04 GMT

Another scoring metric is number of cards reporting balances. There is a penalty for too many accounts with balances. The impact on Fico 8 score is slight, typically 0-10 points depending on profile and % of cards reporting balances.

If the Amazon card with a balance previously reported $0 and QTY increased, it could influence score slightly regardless $ amount.

Details on before/after aggregate utilization and all card utilizations would be enlightening. I'd certainly anticipate a point gain going from 92% UT on a card to 42%.

Re: Frustrating score changes

Zoostation1 — Wed, 14 May 2025 00:59:06 GMT

@AnonymousUpping totals will help, but it doesn't even have to be all that much given just how low the limit is on the OP's Amazon card. Nonetheless a low limit per card does sting. I still consider myself in rebuild mode even though I don't want any additional cards (as far as I'm concerned as long as the BK7 still reports I'm still a rebuilder), but I got pretty excited when I was able to get a $5k card, $10k card and then $20k card. And while my limits are much lower than yours they're still plenty enough now that I really don't worry about my reported utilization as long as I'm PIF. Interestingly I looked up the average total credit limit and number of cards per person (according to experian) and it's $29,855 TCL and 3.9 cards. I'd also like to know the median, but couldn't find that data. I suspect the averages for people who frequent myFICO forums are well above that of the geneneral public.

Re: Frustrating score changes

MrsCHX — Fri, 16 May 2025 00:23:52 GMT

I don't shop at Amazon anymore and they dropped my limit over time to where it rests at $350. I pretty much only use it if my kid/grandkids need something and I'm helping out (they live across the country). So I could probably get Synch to up the limit but I just don't care as much about that one.

in my prior life I had $25k with NFCU and $10k with Disco and $15k with AMEX and and and and. I just don't care about huge limits anymore because it entices me to spend. I won't get into the reasons for my current balances but while the overspending isn't an issue now, I'm just not into the "game" anymore.

I'll be closing a few of the existing lines and will make life work with Capital One and PenFed. And gotta have my Target card. Lol!

Re: Frustrating score changes

FicoMike0 — Fri, 16 May 2025 00:44:14 GMT

Modebly frustrating. Sync is getting famous for cutting limits. As far as not shopping Amazon, I don't love them either, but sometimes they are the best choice. Still, you don't have to use an Amazon card at Amazon. I was using nfcu flagship, who paid for annual prime membership. I just switched to USB shoppers, I made Amazon one of my 6% stores.

Re: Frustrating score changes

FICOdawg — Mon, 19 May 2025 13:09:05 GMT

My personal situation will bear this out in data. Going to be able to see direct impact of my total and individual utilization as I continue to pay down my card. Waiting for my next update from Experian to see impact of scenario you mention. Paid off 2 out of 3 card and about 78% utilization on last card to pay off. Will be interesting data points coming up for me.

The question to answer is does total or individual utilization count more? You would think there would be a weighting factor so a small CL card doesn't sink the entire ship as in OPs case.

Re: Frustrating score changes

FICOdawg — Mon, 19 May 2025 13:12:51 GMT

So what's the ideal number? I have 3 cards. How many can report a balance and not result in FICO hit?

Re: Frustrating score changes

JoeRockhead — Mon, 19 May 2025 13:58:35 GMT

@FICOdawg wrote:
So what's the ideal number? I have 3 cards. How many can report a balance and not result in FICO hit?

If they're all revolvers, your ideal number is 1 reporting a balance. Anything more than 50% of revolving accounts reporting balances gets a slight score penalty for "too many accounts with balances".

Re: Frustrating score changes

Zoostation1 — Tue, 20 May 2025 00:06:34 GMT

@JoeRockheadCrossing 50% appears to have cost me 3pts on EQ8. I've temporarily gone from 3/7 to 4/7 reporting with 7.4% utilization (not high enough to trigger any known threshold afaik) and dropped from 700 to 697. EX8 has not changed (I know Experian will refresh daily for FICO 8 so I wonder if EX is less sensitive to this). TU8 I haven't seen a decrease yet, but I can't rule it out yet as I don't know if the change in reporting triggered a myFICO scoring update and my last DiscoverTU8 update is from the same day the 4th account reported so it's still showing 3/7 reporting.

Re: Frustrating score changes

Thomas_Thumb — Tue, 20 May 2025 04:01:17 GMT

As a general rule Experian is less sensitive to multiple cards reporting balances that EQ or TU. This is most apparent with the older mortgage Ficos.

Re: Frustrating score changes

FICOdawg — Thu, 22 May 2025 13:25:19 GMT

I have free Experian. I get major points for aggregate utilisation reduction.

i did debt snowball from smallest to biggest CC. Paid off 2 of them. Remaining card has 81% utilisation. I'm at a 752 now, bottomed out in December at 695 when I started the payoff journey.

At least from what I've seen the total utilisation is a major factor. As I pay off the final card over the next 6-7 months the aggregate and individual utilisation drop, hard to tease out what counts more but in my case the total credit used is a big knob. This makes more sense then to have one card control the entire narrative.

Re: Frustrating score changes

Thomas_Thumb — Thu, 22 May 2025 22:06:38 GMT

Yes, I have found EX is more sensitive to aggregate utilization changes but less sensitive to number of cards reporting balances. I believe EX is also more sensitive to highest individual card utilization than EQ and possibly TU. However, that could be file dependent.

That 81% UT card is definitely hurting regardless of aggregate UT.

Re: Frustrating score changes

FICOdawg — Thu, 22 May 2025 15:02:34 GMT

My total UT is now 41% which will drop below 39% with next payment so nearly every month I'll be crossing thresholds for aggregate and total. In my report from EX it only mentions total so it's interesting they don't mention individual.

Keep in mind my two chase cards I've had over 10 years plus for both of them.

If someone has 30000k total CL but a $500 card with $300 balance on it and other cards zero or small balances there is an inequity if they hammmer you in that way. If it's not weighted it's an error in the model.

Re: Frustrating score changes

Thomas_Thumb — Thu, 22 May 2025 16:31:28 GMT

Fico has card related scoring metrics for:

1. Aggregate revolving utilization.

2. Highest revolving utilization on any of your individual cards.

3. Number of accounts and % of open cards with balances. This includes charge cards

4. Aggregate credit card balance in $- this includes charge cards

Aggregate utilization is given the most weight but number/% of cards reporting balances can have considerable impact on the older Fico mortgage scores.

Highest utilization on individual cards does not factor in credit limit nor should it. That is handled in metric #1. Individual utilization is given less weight but a single "maxed out" card can have a substantial impact on score. Some notable thresholds are: 89%, 49% and 29%. My read is that it represents a risk assessment on management of all accounts - not just priority accounts.

Do you think a 30 day late on a $500 CL cards is weighed less than one on a $5000 CL card? It is not

Re: Frustrating score changes

FICOdawg — Thu, 22 May 2025 16:54:34 GMT

A late is different. Entire discussion has been related to utilization.

reality is any acct you have needs to have auto pay set-up to prevent so late reporting on a $20 balance.

Re: Frustrating score changes

Thomas_Thumb — Thu, 22 May 2025 17:22:14 GMT

I'm telling you how it works with individual card utilizations. I agree with it. You don't have to. Regardless, individual card utilization does not get weighed based on the card's CL except for its contribution toward aggregate.

FWIW - There is a newish thread in Smorgasboard where posters discuss changes they would make if they designed a credit scoring model.