topic Re: Not sure why my score isn't higher.... in Understanding FICO® Scoring

Not sure why my score isn't higher....

Anonymous — Mon, 11 Jun 2007 00:58:43 GMT

Hi all!

Yes, this is another one of those types of posts...!

Disclaimer - yes, my scores are already high, I know that. But, as someone else noted on this board, having a buffer is nice, and someone else had a job that required an 800 score, so there are reasons for wanting the higher scores.

But you know what? It's not really that so much as a "what the heck is going on here" kind of question, coupled with "I've done my part, where's the score?"

I'm not sure what sort of info to put in the post to help describe the situation, here's a shot:

* No missed or late payments, on anything, at any time

* Ratio of revolving balance to limit - 1% (o n e p e r c e n t)

* 19 year credit history

* 17 accounts, 4 with balances, 0 opened in last year, no new accounts,
no inquiries, no collections, no public records

Like I said, I've been careful.

My TU report says I have high balances in my non-mortgage credit accounts,
about $7000 (car loan).

I also note that 2 closed accounts show current status as "Unrated or
bankruptcy" including one CC that was stolen from my mailbox.

Now, one thing that certainly irks me is that I've been pulling my CRs for
some months now (pre-forums) and (silly me) working on the advice that
the reports have given me. Well of course my scores have actually declined.
Not a huge amount, but I did fix some reporting issues (an extra $150K of
mortgage was still reporting, for example) and moved my CC payments to
before they're reported to the CRAs and also paid off a auto loan completely.

My questions:

* Any ideas of why my score is slumping, even as I've cleaned up the reporting
issues and ratios?

* What would be the impact of paying off my last auto loan?

* What would be the impact of going entirely debt free by also paying off
my mortgage?

Don't misunderstand me, I know full well that chasing FICO scores takes a
back seat to smart financial moves. I just wish they were one and the same -
I'm really starting to think that FICO is an attractiveness rating more
than anything else, but it's being used by other parties as a proxy for
being financially astute. Shoot, just remembered another reason to have
high scores - INSURANCE.

Thanks folks!

Re: Not sure why my score isn't higher....

Anonymous — Mon, 11 Jun 2007 01:09:19 GMT

My questions:

* Any ideas of why my score is slumping, even as I've cleaned up the reporting
issues and ratios?

* What would be the impact of paying off my last auto loan?

* What would be the impact of going entirely debt free by also paying off
my mortgage?
________________________________________________________________________________

What are your FICO scores??

1.) Maybe you have switched FICO "buckets" or "scorecards". Meaning FICO compares other consumers with scores similar to yours and then scores you. Maybe others in your so-called group have performed better than. Nothing you can do about, just FICO craziness. Just keep paying on time, like you have been doing.

2.) Paying off your auto early will not improve your scores. Paying it for the life of your loan should help some with your scores.

3.) same as #2

FICO does not punish you for having balances on installments, autos and mortgages unless a consumer finance TL is reporting. Also, your util on your cc's is great. Having 1-9% util on all your cards is ideal.

Re: Not sure why my score isn't higher....

Anonymous — Mon, 11 Jun 2007 05:52:09 GMT

I was chasing this same thing under the 850 fico algarithom thread. Some people hit a limit between 825 and 835. I have been trying to find out why. I have found people that claim to be in the 840s but never saw their printed score to prove it. After so much time, activity changes don't seem to effect the score much. Another words with so many accounts, your score doesn't drop. So in your case you might have a score that doesn't drop as much which is better than a constantly changing score. What is your current score?

Re: Not sure why my score isn't higher....

fused — Mon, 11 Jun 2007 05:56:13 GMT

Sorry to be weird but do you really love pizza? I live in Hawaii and the pizza here is, well the pits. I haven't had good pizza since I was in Chicago back in 89.

Re: Not sure why my score isn't higher....

Anonymous — Mon, 11 Jun 2007 08:07:39 GMT

ilovepizza wrote:
I have found people that claim to be in the 840s but never saw their printed score

I have a feeling that the vast majority of the population is so completely clueless about their FICO scores that if asked about their scores they would respond, "Well, I pay my bills online, have a mortgage, a car payment, some credit cards, so I figure I've gotta be up in the 800s."

Re: Not sure why my score isn't higher....

Anonymous — Mon, 11 Jun 2007 08:25:55 GMT

Jobs requiring an 800 FICO are few and far between. If one is already in a particular field where that's a possibility, then one is likely already aware and already gaming the FICO model to max their score. Darned few employers truly even pull CRs.

On your what the heck and where's my score wonderings, I would have to agree with you. But so what. Ain't nuttin' gonna change on that front, at least not here. Bang off a couple of letters to your Senators and Congresscritter inquiring about this mystery of the FICO scoring model.

Are the "Unrated or bankruptcy" TLs listing as adverse TLs? If so, disputing those would be a path to a score gain.

If you're seriously considering PIF your mortgage and a $7000 balance on a car loan, what do you hope to gain?

I'm a software engineer, and I know there's not a hope in heck an employer would pull my CR unless I took a job at Cap 1. [Considered a contract gig there once. They do pull CRs on everyone, contract and FTEs.] Even if they did pull my CR, they wouldn't require an 800 FICO. I once talked to NASDAQ about a perm programming job. Wasn't interested, but even they didn't pull CRs. Of course, this was 9 years ago so things mighta changed.

Couple of friends of mine in the field are ex-military and used to have security clearances. Post 9/11, IT skills and security clearance started to become a little in demand, but mondo dollars never quite materialized. Just a steady paycheck. In any event, security clearances were a must and having one in the past seems to help getting one in the future. But, missed payments, lates and other warts on one's credit report can spike a clearance.

I don't know what your outstanding mortgage balance is, but a bundle of money burning a hole in your pocket to pay off loans would look a lot better in a stock mutual fund earning 12 percent or more.

Re: Not sure why my score isn't higher....

Anonymous — Mon, 11 Jun 2007 23:25:30 GMT

I was only using the job as one of MANY examples of why wanting a high FICO score is desirable. As I previously mentioned, insurance is now priced with your CR in mind as well.

I don't think the "Unrated or BK" listings are adverse - but how would I check that?

PIF is to avoid interest charges. I'm not looking to gain on FICO by PIF, again, read my OP, I know that smart financial moves are not equated to FICO score increases. I would like to know what impact PIF my mortgage would have.

So, my questions still stand... I do know a bit about pooling, but this is still a bit beyond the pale.

I did see in another thread to "a good mix of credit;" any more details on that?

Re: Not sure why my score isn't higher....

Anonymous — Tue, 12 Jun 2007 04:51:31 GMT

I'm not really sure what you're after. Maximizing your FICO score AND eliminating your interest payments aren't compatible.

Re: Not sure why my score isn't higher....

Anonymous — Tue, 12 Jun 2007 18:09:42 GMT

Ah - OK, this may be good info - can you elaborate?

Re: Not sure why my score isn't higher....

Anonymous — Tue, 12 Jun 2007 19:49:53 GMT

Any employer snooty enough to demand an 800 FICO, I wouldn't want to work for anyway. Heck, maybe I'd just forge a Church of Satan membership card and flash it at them to get in the door.

Once your FICO hits 760 or so, relax. Make financial decisions based on eliminating debt and maximizing ROI, not gaining or losing a few points here and there on FICO.

Re: Not sure why my score isn't higher....

Anonymous — Tue, 12 Jun 2007 20:22:49 GMT

credituser wrote:
Ah - OK, this may be good info - can you elaborate?

Well, if you carry a balance that shows CC util of between 1 and 9 percent, you will maximize your FICO scores. However, you'll be paying a little bit of interest on that 1 to 9 percent balance.

Which are you seeking?

No interest payments? If so, then pay off EVERY loan you have. However, I think with a few exceptions of folks way out on the fringe, almost no one in the world of finance would advise this. The loan on my minivan is, IIRC, 3.9 percent. If someone dropped $18K in my lap, I'd be a danged fool to pay off the van. I'd pay down CC debt and use the rest for a downpayment on a house. If I had zero CC debt and a mortgage, I'd max out IRAs for me and the wife and put the rest in 529s. If I'd already maxed out IRAs for this year (both Roth and Traditional) and maxed out 529s for both my kids, I'd put the money to use in the stock market and probably subscribe to Jim Cramer's stock alerts. I'd keep the van payment and house payment. If the vehicle loan was something like 12 percent, or I had a subprime home loan at 9 percent, then it would be a different story.

A higher FICO score? Then carry a balance on all your CCs of between 1 and 9 percent util and keep at least some of your installment loans.

Re: Not sure why my score isn't higher....

MercyMe — Thu, 21 Jun 2007 21:11:20 GMT

Hi, Noah. ... I found it rather curious that the company my 26 year old son works for would require him to have a credit score of at least 750. Fortunately, and through no effort of his own, he had it, when needed, to obtain an upper level -- no spending limit, credit card with which he makes rather costly purchases, and for which he has always been promptly reimbursed. He's an Industrial Designer, and part of his job entails buying the competition's products for design study. I couldn't for the life of me understand why they wouldn't just give him an expense account or a company charge card -- it's just their policy.

Re: Not sure why my score isn't higher....

Anonymous — Thu, 21 Jun 2007 21:23:27 GMT

MercyMe wrote:
Hi, Noah. ... I found it rather curious that the company my 26 year old son works for would require him to have a credit score of at least 750. Fortunately, and through no effort of his own, he had it, when needed, to obtain an upper level -- no spending limit, credit card with which he makes rather costly purchases, and for which he has always been promptly reimbursed. He's an Industrial Designer, and part of his job entails buying the competition's products for design study. I couldn't for the life of me understand why they wouldn't just give him an expense account or a company charge card -- it's just their policy.

Hi MercyME - OK, so the score was an initial requirement. How often did they recheck it, if at all? Would he lose his job if it dipped to 730?

And Noah - you once considered a job at CapOne? Working for the dark side?!

Re: Not sure why my score isn't higher....

MercyMe — Fri, 22 Jun 2007 01:05:08 GMT

I don't know that they would recheck it. Surely, if he were unable to make purchases, and had to ask them for the means, they might have something to say. Then again, it's a rather large company and he's the only Industrial Designer, and they are quite happy with him, so I don't know what they would do if they checked his scores and found them floudering. He quit a while back, and for a short time, when there were just too many trips away from home -- like to L.A., Chicago, Costa Rica and Hong Kong -- outsourcing, you know -- to oversee the production of his designs. Now he stays in the states, with an occasional trip to Costa.

This is upscale outdoor furniture that goes into the more posh hotels and resorts and outside multimillion dollar homes. It's not unusual for him to load his truck up with several thousands of dollars worth of competitor's products, only to rip it all apart. Can you imagine? I'd put the stuff in my livingroom! He does graphic design, as well, so is responsible for their catalog.

He'll be leaving for Chicago -- The Merchandise Mart -- soon, for another show. It's a big deal. They all try to out do one another in design for various awards. They won three, last year. Ha! His third grade teacher once said of him, "He'd rather draw, than breathe." That's for sure. He'd rather be designing cars -- and had a full scholarship to the University of Michigan, which would have put him on Detroit's doorstep; but, he fell in love and got married instead. It's just as well. I would miss him.

Re: Not sure why my score isn't higher....

Anonymous — Fri, 22 Jun 2007 08:06:36 GMT

MercyMe wrote:
I found it rather curious that the company my 26 year old son works for would require him to have a credit score of at least 750.
...
He's an Industrial Designer, and part of his job entails buying the competition's products for design study.

Bizarre. Normally it's only financial gigs, like underwriters that do those sorts of things.

Re: Not sure why my score isn't higher....

Anonymous — Fri, 22 Jun 2007 08:15:41 GMT

masdeocho wrote:

And Noah - you once considered a job at CapOne? Working for the dark side?!

Considered may be too strong a word. The headhunter called, he said Unisys and Richmond, so I knew it was one of two places. Cap 1 or the Commonwealth of Virginia. I asked, and he said Cap 1. I let out a silent ugh. Listened to the pitch, then said no thanks, particularly when they said gimme your SSN.

I talked to NASDAQ about a job, maybe 9 years ago. Job sounded very promising, except for money. It was in Trumbull, CT. Pay was higher than I was getting, but with the cost of living in CT, not even what they were paying woulda offset things to a break even point. Even with that, the headhunter (guy I know and trust) said most of the folks working there lived another 20 miles or so up the road, where it was more affordable. They never even mentioned credit reports or FICOs. I told the headhunter I wasn't interested, and they still wanted me to fly me in for an interview.

Re: Not sure why my score isn't higher....

MercyMe — Fri, 22 Jun 2007 14:59:59 GMT

credituser wrote:

Ah - OK, this may be good info - can you elaborate?

Noahbodie wrote:

Well, if you carry a balance that shows CC util of between 1 and 9 percent, you will maximize your FICO scores. However, you'll be paying a little bit of interest on that 1 to 9 percent balance.

Which are you seeking?

A higher FICO score? Then carry a balance on all your CCs of between 1 and 9 percent util and keep at least some of your installment loans.

Mercy writes ... my goodness! I think I need to start taking notes, or compile a notebook of all of the financial advice some of you give, like you, Noah, and Tuscani, and Masedocho -- so many! If I apply some of this, I'm sure not to end up a bag lady in say 25-30 years, huh?