topic Re: Why don't decreases show up in my FICO score quickly like increases do??? in Understanding FICO® Scoring

Why don't decreases show up in my FICO score quickly like increases do???

Anonymous — Sat, 13 Dec 2008 07:08:36 GMT

My FICO score goes down every time I increase a balance, even a minor increase, but doesn't go up when I pay off debts. WHY?

For example:

Last week I paid off approximately $10,000 in debts with NO response from MyFICO or Experian, both of which send me alerts. Indeed, there was no change in my score.

This week an old, inactive credit card charged me a $20 annual fee. Experian reported it as a 2500% increase and my credit score dropped.

I recently refinanced my house and paid off the old mortgage. Nothing happened to my credit score.

This week the new mortgage was reported to the credit bureaus. My score went down 11 points.

This happens to me consistently. I don't see it covered in the materials recommended. Why is this?

Re: Why don't decreases show up in my FICO score quickly like increases do???

Junejer — Sat, 13 Dec 2008 07:30:30 GMT

Installment util doesn't work the same as revolving util. Revolving is much more sensitive to $ movement. The reason you lost points on the new reporting is that your AAoA was adversely affected.

Re: Why don't decreases show up in my FICO score quickly like increases do???

Anonymous — Sat, 13 Dec 2008 14:57:13 GMT

That and a new account dings your "new credit" portion of your credit score. This effect will lessen over the year though. Byrd is right that revolving utility (aside from a clean payment history) is the single most important factor that goes into your credit score. As long as you are making your installment payments on time, there is very little difference between having 80 percent utility on an account and 20.