topic Re: Confused!!! in Understanding FICO® Scoring

Confused!!!

KellyP25721 — Wed, 11 Mar 2015 22:08:14 GMT

I have 3 credit cards reporting balances for a total utilization of 16%. Trying to maximize my scores so I paid two of them off, although only one has been reported to the CRA's. TU jumps 12 points and Ex jumps 3 and EQ drops 3?

Re: Confused!!!

KellyP25721 — Wed, 11 Mar 2015 22:16:56 GMT

It doesn't make sense when they dinged me 15 pts two months ago when I orginally let all the cards report a balance.

Re: Confused!!!

NRB525 — Thu, 12 Mar 2015 02:18:05 GMT

Your scores are a bit low. Do you have any negatives such as charge offs, lates of any kind, disputes, BK, any negative in your file?

How long have you had your CC?

Re: Confused!!!

tonyjones — Thu, 12 Mar 2015 02:24:39 GMT

FICO scores are all over the place with you have derogs, it's really hard to pinpoint anything.

Re: Confused!!!

KellyP25721 — Thu, 12 Mar 2015 13:30:15 GMT

@NRB525 wrote:
Your scores are a bit low. Do you have any negatives such as charge offs, lates of any kind, disputes, BK, any negative in your file?
How long have you had your CC?

Yes, I do have some derogs that I have been trying to goodwill but had not luck on. So I do understand why my socres are on the low side. With nothing new reporting for the past year, my scores have only fluctuated based on credit card usage. So what I'm trying to understand is why I didn't get the points back when I paid the card off again. They dinged me 10pts when the 2nd card reported a balance and then 4 more points when the 3rd card reported a balance. I was expected to get the points back when I paid the card off again. It always has in the past.

Re: Confused!!!

Anonymous — Thu, 12 Mar 2015 14:40:16 GMT

@KellyP25721 wrote:
@NRB525 wrote:
Your scores are a bit low. Do you have any negatives such as charge offs, lates of any kind, disputes, BK, any negative in your file?
How long have you had your CC?
Yes, I do have some derogs that I have been trying to goodwill but had not luck on. So I do understand why my socres are on the low side. With nothing new reporting for the past year, my scores have only fluctuated based on credit card usage. So what I'm trying to understand is why I didn't get the points back when I paid the card off again. They dinged me 10pts when the 2nd card reported a balance and then 4 more points when the 3rd card reported a balance. I was expected to get the points back when I paid the card off again. It always has in the past.

And it will occur again shortly. I can almost assure you, that if everything else remains constant, that you'll see your scores move upward in the next few weeks. Scores go up when you lower your utilization. They may not go up as quickly as you like or in the fashion that you think it should, but they do go up. I think you'll notice a upward climb in the next few days/week. I can't say why your score reacted the way it did but I do know that it wll go up.

Re: Confused!!!

KellyP25721 — Thu, 12 Mar 2015 18:05:21 GMT

The 2nd card I payed off reported today and my score jumped 16 points so who knows how they calculate this stuff. I guess it's their job to keep us guessing!

Re: Confused!!!

Vegas247 — Thu, 12 Mar 2015 18:13:24 GMT

@KellyP25721 wrote:
The 2nd card I payed off reported today and my score jumped 16 points so who knows how they calculate this stuff. I guess it's their job to keep us guessing!

Did you update your current FICO scores in you signature? Or do you still have to update your sig?

Re: Confused!!!

tonyjones — Thu, 12 Mar 2015 20:00:20 GMT

I never understood when people here say to leave all balances $0 except one card at 1-10%. It seems like FICO dings you for any revolving account with $0 balance.

Re: Confused!!!

NRB525 — Fri, 13 Mar 2015 04:07:46 GMT

@tonyjones wrote:
I never understood when people here say to leave all balances $0 except one card at 1-10%. It seems like FICO dings you for any revolving account with $0 balance.

I don't think there is any science to that idea at all. It's a case where the most particular people use that as a way to get utilization down, they see a score drop when the cards come out of zero balance, and conclude the card needs to stay at zero balance. The real issue is, utilization should be kept low, overall. One card reporting 1%-9% does that nicely, but it's the utilization overall, not the "only one card with balance" that affects the score.

Re: Confused!!!

Anonymous — Fri, 13 Mar 2015 04:28:46 GMT

@NRB525 wrote:
@tonyjones wrote:
I never understood when people here say to leave all balances $0 except one card at 1-10%. It seems like FICO dings you for any revolving account with $0 balance.
I don't think there is any science to that idea at all. It's a case where the most particular people use that as a way to get utilization down, they see a score drop when the cards come out of zero balance, and conclude the card needs to stay at zero balance. The real issue is, utilization should be kept low, overall. One card reporting 1%-9% does that nicely, but it's the utilization overall, not the "only one card with balance" that affects the score.

FICO scores both overall and individual utilization.

Re: Confused!!!

NRB525 — Fri, 13 Mar 2015 13:40:46 GMT

@Anonymous wrote:
@NRB525 wrote:
@tonyjones wrote:
I never understood when people here say to leave all balances $0 except one card at 1-10%. It seems like FICO dings you for any revolving account with $0 balance.
I don't think there is any science to that idea at all. It's a case where the most particular people use that as a way to get utilization down, they see a score drop when the cards come out of zero balance, and conclude the card needs to stay at zero balance. The real issue is, utilization should be kept low, overall. One card reporting 1%-9% does that nicely, but it's the utilization overall, not the "only one card with balance" that affects the score.
FICO scores both overall and individual utilization.

I did a BT a few weeks ago, moved $720 from my CapOne to the Diamond Prefered $1k limit card, so that Citi DP went to 72% utilization. The CapOne has not come around the cycle to reduce it's balance, no other balances reported changes, so when the Citi DP reported a few days ago, it looked like:

Citi DP goes from $0 reported to $721, 0% Util to 72% Util on that card on EX.

Total balances reported went up by $721. This is the TU display.

EX went down 1 point, from 732 to 731

TU went down 4 points, from 720 to 716.

EQ, which was already at 698, has not budged, and enough days have passed for it to trigger anything. EQ has not moved in nearly a month.

In this case of $720 added to open amounts, was the score decline because total amounts outstanding appeared to rise by $720, or because one card went to 72% utilization? Or, is it because this card went from $0 to reporting something, thus "taking on new debt"? Lots of potential interpretations.

I will grant there may be some influence by individual cards, but in my opinion, the amount is not noticeable and is not distinguishable from total balances increasing. If there are big moves when someone reports utilization increases, it is because either total utilization changes a lot, or there are other things going on in the file that are not on that alert. It is also very difficult to separate high utilization on one card from overall high utilization.

Re: Confused!!!

Anonymous — Fri, 13 Mar 2015 17:13:09 GMT

@NRB525 wrote:
@Anonymous wrote:
@NRB525 wrote:
@tonyjones wrote:
I never understood when people here say to leave all balances $0 except one card at 1-10%. It seems like FICO dings you for any revolving account with $0 balance.
I don't think there is any science to that idea at all. It's a case where the most particular people use that as a way to get utilization down, they see a score drop when the cards come out of zero balance, and conclude the card needs to stay at zero balance. The real issue is, utilization should be kept low, overall. One card reporting 1%-9% does that nicely, but it's the utilization overall, not the "only one card with balance" that affects the score.
FICO scores both overall and individual utilization.
I did a BT a few weeks ago, moved $720 from my CapOne to the Diamond Prefered $1k limit card, so that Citi DP went to 72% utilization. The CapOne has not come around the cycle to reduce it's balance, no other balances reported changes, so when the Citi DP reported a few days ago, it looked like:

Citi DP goes from $0 reported to $721, 0% Util to 72% Util on that card on EX.
Total balances reported went up by $721. This is the TU display.

EX went down 1 point, from 732 to 731
TU went down 4 points, from 720 to 716.
EQ, which was already at 698, has not budged, and enough days have passed for it to trigger anything. EQ has not moved in nearly a month.

In this case of $720 added to open amounts, was the score decline because total amounts outstanding appeared to rise by $720, or because one card went to 72% utilization? Or, is it because this card went from $0 to reporting something, thus "taking on new debt"? Lots of potential interpretations.

I will grant there may be some influence by individual cards, but in my opinion, the amount is not noticeable and is not distinguishable from total balances increasing. If there are big moves when someone reports utilization increases, it is because either total utilization changes a lot, or there are other things going on in the file that are not on that alert. It is also very difficult to separate high utilization on one card from overall high utilization.

That is your experience but doesn't mean it will work that way for everyone. As always YMMV.

Although more weight is given to overall utilization scoring also looks at individual accounts and the influence of each account balance is important and needs to be kept in mind.

Where did I get this information? From a former administrator of this site.

Re: Confused!!!

NRB525 — Sat, 14 Mar 2015 02:36:55 GMT

@Anonymous wrote:
@NRB525 wrote:

I will grant there may be some influence by individual cards, but in my opinion, the amount is not noticeable and is not distinguishable from total balances increasing. If there are big moves when someone reports utilization increases, it is because either total utilization changes a lot, or there are other things going on in the file that are not on that alert. It is also very difficult to separate high utilization on one card from overall high utilization.
That is your experience but doesn't mean it will work that way for everyone. As always YMMV.

Although more weight is given to overall utilization scoring also looks at individual accounts and the influence of each account balance is important and needs to be kept in mind.

Where did I get this information? From a former administrator of this site.

That may be, however I doubt the former administrator could state the impact as a range of points, in a stable file, from having more cards report.

My main argument is not that one can eek out a few more points by going all but one zero. Rather, all but one as zero is not what normal people do. And even if someone uses their cards such that those cards report amounts on the statement and PIF, that person is not going to have a noticeable score difference from someone who goes all zero but one, if they both report the same utilization dollar total and the files are otherwise equivalent. And the person who uses their cards normally, paying by due date is not going to have the angst of getting a card that was zero suddenly reporting a balance.

I know, I'm not changing your mind, and that's fine. Cheers!