topic Re: 3-month Plan For Maximizing Score in General Credit Topics

3-month Plan For Maximizing Score

Jazee — Tue, 25 Jun 2024 01:59:29 GMT

I need my score maximized in 3 months. Currently my Fico 8 is 737, TU 668, EQF 671. I have 4 credit card accounts (one of which is Amazon Store Card), 3 of the four credit accounts are about 3 years old and one is about 20 years old. An Auto loan 3 years into 5-year loan. No other debt accounts. 1 hard inquiry with removal date (according to Experian Sep 2024). No collections or charge offs.

The thing weighing the score down is just my credit uilization: 70%. I expect to be a 60% in 1 month, and 40-50% in another 3 months. Not buying a house this year.

The obvious answer everyone would of course respond with is pay off as much debt as possible. So I'm looking for things to do other than that to maximize my score in 3 months.

The only other slight weekness is my credit mix with no mortgage or personal loan. Yet my score is I think too low to apply for a personal loan and that's going to lower my average account age. My cards are with USAA, NFCU, and Amazon (Synchrony). The Amazon card is already $10K which it's almost always $0 balance or lower than 5% utilization. NFCU My Sig Card with the lowest APR is the majority of my debt with a $25K and 90% utilization, so that's not going up. I have another card with NFCU which is 70% utilized but will be 0% within 3 months. USAA I think compared to NFCU is much less apt to do a credit increase and if they do a Hard Pull and deny that's only going to lower my score a few points.

I'm thinking the best chance is in 3 months ask for CLI on the lower limit NFCU. If a soft pull, no harm no foul. What I'm not sure about is trying to apply for a line of credit which I just use a little each month and pay off. But it seems the best time to do that would be when my score is highest in 3 months and at which time opening a line of credit is again just going to lower my average account age, but would the increase in available credit more than compensate? I'm thinking maybe if it's at least 10% increase in credit $4,500 but not something like a $500 NFCU CLOC. LOL.

Re: 3-month Plan For Maximizing Score

Tiggr — Tue, 25 Jun 2024 01:51:58 GMT

Maybe request for an increase on the NFCU now through the app (for some reason CLI requests through the app are a soft pull) and if you get denied you have a good enough amount of time between (3 months) to do it again. Whichever way you try, you're right that paying down util is the best option.

Re: 3-month Plan For Maximizing Score

AverageJoesCredit — Tue, 25 Jun 2024 03:02:05 GMT

@Tiggr wrote:
Maybe request for an increase on the NFCU now through the app (for some reason CLI requests through the app are a soft pull) and if you get denied you have a good enough amount of time between (3 months) to do it again. Whichever way you try, you're right that paying down util is the best option.

This. Navy should be SP, no harm no foul. If they deny now you won't be penalized for it lol, sorta like the good old days of requesting cli from Discover. Navy can suprise you when you need it most but if not going down big time on one card can be helpful in 3 months. I would also try for a cli on Amazon, sp as well. Nothing ventured nothing gained. Good luck

Re: 3-month Plan For Maximizing Score

Tiggr — Tue, 25 Jun 2024 03:52:41 GMT

@AverageJoesCredit wrote:
@Tiggr wrote:
Maybe request for an increase on the NFCU now through the app (for some reason CLI requests through the app are a soft pull) and if you get denied you have a good enough amount of time between (3 months) to do it again. Whichever way you try, you're right that paying down util is the best option.

This. Navy should be SP, no harm no foul. If they deny now you won't be penalized for it lol, sorta like the good old days of requesting cli from Discover. Navy can suprise you when you need it most but if not going down big time on one card can be helpful in 3 months. I would also try for a cli on Amazon, sp as well. Nothing ventured nothing gained. Good luck

I was reading around and some people reported NFCU doing a hard pull if you requested a CLI over the phone or through messages. That's why I specified through the app. I didn't know about discover though, recent change?

Re: 3-month Plan For Maximizing Score

FicoMike0 — Tue, 25 Jun 2024 04:59:58 GMT

I agree, getting utilization down is most important. You mention not having a loan. Since your with navy, they're famous for ssl. I did one with penfed, got 30-40 points. Since you're strung out with cc debt, the up front capital might be a problem. Penfed will do ssl for about half what navy requires. It's a soft pull, I wouldn't think it's hard to qualify, since your borrowing your own money. It does count as new account.

Re: 3-month Plan For Maximizing Score

Thomas_Thumb — Tue, 25 Jun 2024 17:35:29 GMT

@Jazee wrote:
I need my score maximized in 3 months. Currently my Fico 8 is 737, TU 668, EQF 671. I have 4 credit card accounts (one of which is Amazon Store Card), 3 of the four credit accounts are about 3 years old and one is about 20 years old. An Auto loan 3 years into 5-year loan. No other debt accounts. 1 hard inquiry with removal date (according to Experian Sep 2024). No collections or charge offs.

The thing weighing the score down is just my credit uilization: 70%. I expect to be a 60% in 1 month, and 40-50% in another 3 months. Not buying a house this year.

The obvious answer everyone would of course respond with is pay off as much debt as possible. So I'm looking for things to do other than that to maximize my score in 3 months.

The only other slight weekness is my credit mix with no mortgage or personal loan. Yet my score is I think too low to apply for a personal loan and that's going to lower my average account age. My cards are with USAA, NFCU, and Amazon (Synchrony). The Amazon card is already $10K which it's almost always $0 balance or lower than 5% utilization. NFCU My Sig Card with the lowest APR is the majority of my debt with a $25K and 90% utilization, so that's not going up. I have another card with NFCU which is 70% utilized but will be 0% within 3 months.

You have an open car loan. Adding a SSL or personal loan will not improve score. It would typically drop score due to a new HP and reduced AAoA for installment loans. A known exception to score loss is when the new loan is used to paydown high revolving utilization to a low level. The new loan penalty still happens but is overshadowed by the low UT score boost.

For a decent point gain you definitely need to get all cards below 49% utilization. More preferrably is to get them all below 29%. Instead of taking the one card from 70% to $0, consider taking it to between 45%-48% and apply more $ to the 90% UT card.

You do want atleast 1 card reporting a $0 balance. 100% of cards reporting balances almost always hurts score for profiles with more than 2 cards and many 2 card profiles as well.

Note: Fico scores individual card utilization based on card with highest UT %.

Increasing card CLs thru soft pull CLIs can help if it allows you to get card UT below a threshold (such as 49% or 29%). Unfortunately, your unsecured credit with NFCU is highly leveraged so CLIs on those cards appear unlikely. I'd be concerned about a potential CLD.

Re: 3-month Plan For Maximizing Score

gregbowers — Tue, 25 Jun 2024 09:17:38 GMT

Focus on reducing your credit card utilization aggressively over the next three months. Request a credit limit increase on your NFCU card to help lower your overall utilization ratio. Avoid new credit applications to prevent additional hard inquiries. Keep monitoring your credit report and ensure all payments are made on time. These steps should help maximize your credit score effectively within your timeframe.

Re: 3-month Plan For Maximizing Score

SouthJamaica — Tue, 25 Jun 2024 16:02:18 GMT

@Jazee wrote:
I need my score maximized in 3 months. Currently my Fico 8 is 737, TU 668, EQF 671. I have 4 credit card accounts (one of which is Amazon Store Card), 3 of the four credit accounts are about 3 years old and one is about 20 years old. An Auto loan 3 years into 5-year loan. No other debt accounts. 1 hard inquiry with removal date (according to Experian Sep 2024). No collections or charge offs.

The thing weighing the score down is just my credit uilization: 70%. I expect to be a 60% in 1 month, and 40-50% in another 3 months. Not buying a house this year.

The obvious answer everyone would of course respond with is pay off as much debt as possible. So I'm looking for things to do other than that to maximize my score in 3 months.

The only other slight weekness is my credit mix with no mortgage or personal loan. Yet my score is I think too low to apply for a personal loan and that's going to lower my average account age. My cards are with USAA, NFCU, and Amazon (Synchrony). The Amazon card is already $10K which it's almost always $0 balance or lower than 5% utilization. NFCU My Sig Card with the lowest APR is the majority of my debt with a $25K and 90% utilization, so that's not going up. I have another card with NFCU which is 70% utilized but will be 0% within 3 months. USAA I think compared to NFCU is much less apt to do a credit increase and if they do a Hard Pull and deny that's only going to lower my score a few points.

I'm thinking the best chance is in 3 months ask for CLI on the lower limit NFCU. If a soft pull, no harm no foul. What I'm not sure about is trying to apply for a line of credit which I just use a little each month and pay off. But it seems the best time to do that would be when my score is highest in 3 months and at which time opening a line of credit is again just going to lower my average account age, but would the increase in available credit more than compensate? I'm thinking maybe if it's at least 10% increase in credit $4,500 but not something like a $500 NFCU CLOC. LOL.

1. You would not benefit from adding an installment loan. Your auto loan covers the installment loan bases.

2. Neither would you benefit from adding a CLOC. While adding a CLOC might give you a little better credit mix, you don't want the inquiry and you don't want a new account, so scotch that idea as well.

3. I know this isn't what you were hoping to hear, but the best thing you can do for your scores is to stay the course, paying everything down as best you can, avoiding any new applications or other hard pulls.

4. As you yourself have noted, there's no harm in soft pull applications for CLI's.

Re: 3-month Plan For Maximizing Score

FicoMike0 — Tue, 25 Jun 2024 19:07:38 GMT

When I don't want a hp, I keep all three reports frozen. That way, I know any cli will be a sp.

Re: 3-month Plan For Maximizing Score

Jazee — Thu, 27 Jun 2024 04:02:17 GMT

Yes I always keep everything frozen unless I want to allow a HP.

Re: 3-month Plan For Maximizing Score

Jazee — Thu, 27 Jun 2024 04:08:07 GMT

@Thomas_Thumb wrote:
@Jazee wrote:
I need my score maximized in 3 months. Currently my Fico 8 is 737, TU 668, EQF 671. I have 4 credit card accounts (one of which is Amazon Store Card), 3 of the four credit accounts are about 3 years old and one is about 20 years old. An Auto loan 3 years into 5-year loan. No other debt accounts. 1 hard inquiry with removal date (according to Experian Sep 2024). No collections or charge offs.

The thing weighing the score down is just my credit uilization: 70%. I expect to be a 60% in 1 month, and 40-50% in another 3 months. Not buying a house this year.

The obvious answer everyone would of course respond with is pay off as much debt as possible. So I'm looking for things to do other than that to maximize my score in 3 months.

The only other slight weekness is my credit mix with no mortgage or personal loan. Yet my score is I think too low to apply for a personal loan and that's going to lower my average account age. My cards are with USAA, NFCU, and Amazon (Synchrony). The Amazon card is already $10K which it's almost always $0 balance or lower than 5% utilization. NFCU My Sig Card with the lowest APR is the majority of my debt with a $25K and 90% utilization, so that's not going up. I have another card with NFCU which is 70%
Note: Fico scores individual card utilization based on card with highest UT %.

This is a new fact for me. So for FICO, having a card ar $2k limit at 90% UTI and a card with $30k limit at 5% UTI worse to than having say 10% on the $2k and 25% in the 30k with much higher total UTI?

Re: 3-month Plan For Maximizing Score

SouthJamaica — Thu, 27 Jun 2024 14:02:50 GMT

@Jazee wrote:
@Thomas_Thumb wrote:
@Jazee wrote:
I need my score maximized in 3 months. Currently my Fico 8 is 737, TU 668, EQF 671. I have 4 credit card accounts (one of which is Amazon Store Card), 3 of the four credit accounts are about 3 years old and one is about 20 years old. An Auto loan 3 years into 5-year loan. No other debt accounts. 1 hard inquiry with removal date (according to Experian Sep 2024). No collections or charge offs.

The thing weighing the score down is just my credit uilization: 70%. I expect to be a 60% in 1 month, and 40-50% in another 3 months. Not buying a house this year.

The obvious answer everyone would of course respond with is pay off as much debt as possible. So I'm looking for things to do other than that to maximize my score in 3 months.

The only other slight weekness is my credit mix with no mortgage or personal loan. Yet my score is I think too low to apply for a personal loan and that's going to lower my average account age. My cards are with USAA, NFCU, and Amazon (Synchrony). The Amazon card is already $10K which it's almost always $0 balance or lower than 5% utilization. NFCU My Sig Card with the lowest APR is the majority of my debt with a $25K and 90% utilization, so that's not going up. I have another card with NFCU which is 70%
Note: Fico scores individual card utilization based on card with highest UT %.
This is a new fact for me. So for FICO, having a card ar $2k limit at 90% UTI and a card with $30k limit at 5% UTI worse to than having say 10% on the $2k and 25% in the 30k with much higher total UTI?

Although IMHO @Thomas_Thumb is the most knowledgeable FICO student on the board, I would not accept his opinion as gospel on this point. In my own personal testing I found that the number of highly utilized accounts did matter. Specifically I was testing, in EX FICO 8, whether the number of > 50% accounts had a score impact, even though the accounts were at the same utilization level. And my conclusion was that reducing the number of > 50% accounts having identical utilization levels did in fact increase the EX FICO 8 score.

I didn't really understand your hypothetical above, but if you want to know is it better to have two 20% cards than one 35% card and one 5% card, the answer is yes.

Re: 3-month Plan For Maximizing Score

Thomas_Thumb — Thu, 27 Jun 2024 15:48:31 GMT

@Jazee wrote:
@Thomas_Thumb wrote:
@Jazee wrote:
I need my score maximized in 3 months. Currently my Fico 8 is 737, TU 668, EQF 671. I have 4 credit card accounts (one of which is Amazon Store Card), 3 of the four credit accounts are about 3 years old and one is about 20 years old. An Auto loan 3 years into 5-year loan.

The thing weighing the score down is just my credit uilization: 70%. I expect to be a 60% in 1 month, and 40-50% in 3 months.

I'm looking for things to do other than that to maximize my score in 3 months.

My cards are with USAA, NFCU, and Amazon (Synchrony). The Amazon card is already $10K which it's almost always $0 balance or lower than 5% utilization. NFCU My Sig Card with the lowest APR is the majority of my debt with a $25K and 90% utilization, so that's not going up. I have another card with NFCU which is 70%
Note: Fico scores individual card utilization based on card with highest UT %.
This is a new fact for me. So for FICO, having a card ar $2k limit at 90% UTI and a card with $30k limit at 5% UTI worse to than having say 10% on the $2k and 25% in the 30k with much higher total UTI?

That's not exactly true. The card at 90% utilization does trigger a significant score penalty. In the 2nd case you have no score penalty associated with individual cards but cranking up the total balance will hurt. Fico looks at total balance in addition to aggregate utilization.

Aggregate utilization is an independent scoring factor. Let's look at case 1 based on constant balance with reallocation of funds and then a paydown with no reallocation.

In case 1 aggregate balance is $3300 resulting in an aggregate UT of 10.3% assuming only those 2 cards. Score penalty is significant. Keeping the same total balance, score would be higher by lowering the $2k card from $1800 to $500 (25% UT) and increasing the $30k card to $2800 (9% UT) from $1500 - same $3300 total balance.

Paydown strategy:

$3300 balance on $32k CL is 10.3%. Reducing AG UT below 9% should garner some points. Let's say you can make a $1000 payment. I would apply it all toward the low limit card with an $1800 balance. The new balance of $800 on a $2k CL drops Card UT to 40% , well below the 49% threshold. If the payment had been applied to the $30k CL card, a small score gain from lowering AG UT could be realized but, you would miss out on the added boost of dropping highest card UT from 90% to 40%.

A single card at 90% UT, either high CL or low CL is bad. Slay your beast! As a minimum, get your card under 89% to avoid a max out penalty. The next step would be under 69%.

Re: 3-month Plan For Maximizing Score

FicoMike0 — Thu, 27 Jun 2024 15:47:47 GMT

I would add that having an account remain at or near 90% might trigger balance chasing.

Re: 3-month Plan For Maximizing Score

Thomas_Thumb — Thu, 27 Jun 2024 23:28:47 GMT

Here is a chart of utilization vs score for a 1 card test subject. The data was initially presented on a non Fico forum as a table. A member re-listed it on MyFICO back in 2015. Based on 1 card only, individual card utilization equals aggregate utilization. Actual data points provided at: 9%, 19%, 30%, 41%, 49%, 55% and 80%.

The data was converted to a graphical format to compare fit against previously identified 10%, 30%, 50% and 70% thresholds. It suggested there should be a potential step change threshold at 19% or a sloped region between 9% and 30%. The sloped version was chosen for the graph as being more likely. Based on a belief that utilization rounds up to the next highest whole number for scoring considerations and to add a margin of safety; UT threshold guidelines were established as 9%, 29%, 49%, 69% and 89%.

Areas of interest in the graph are between 9% and 30% where score declines (note 19% datapoint) followed by 30%, 41% and 49% where score is constant and 55% where it again dropped.

Additional note: aggregate utilization is weighed more heavily than individual card utilization.

Re: 3-month Plan For Maximizing Score

Jazee — Fri, 28 Jun 2024 00:22:11 GMT

@SouthJamaica wrote:
@Jazee wrote:
@Thomas_Thumb wrote:
@Jazee wrote:
I need my score maximized in 3 months. Currently my Fico 8 is 737, TU 668, EQF 671. I have 4 credit card accounts (one of which is Amazon Store Card), 3 of the four credit accounts are about 3 years old and one is about 20 years old. An Auto loan 3 years into 5-year loan. No other debt accounts. 1 hard inquiry with removal date (according to Experian Sep 2024). No collections or charge offs.

The thing weighing the score down is just my credit uilization: 70%. I expect to be a 60% in 1 month, and 40-50% in another 3 months. Not buying a house this year.

The obvious answer everyone would of course respond with is pay off as much debt as possible. So I'm looking for things to do other than that to maximize my score in 3 months.

The only other slight weekness is my credit mix with no mortgage or personal loan. Yet my score is I think too low to apply for a personal loan and that's going to lower my average account age. My cards are with USAA, NFCU, and Amazon (Synchrony). The Amazon card is already $10K which it's almost always $0 balance or lower than 5% utilization. NFCU My Sig Card with the lowest APR is the majority of my debt with a $25K and 90% utilization, so that's not going up. I have another card with NFCU which is 70%
Note: Fico scores individual card utilization based on card with highest UT %.
This is a new fact for me. So for FICO, having a card ar $2k limit at 90% UTI and a card with $30k limit at 5% UTI worse to than having say 10% on the $2k and 25% in the 30k with much higher total UTI?
Although IMHO @Thomas_Thumb is the most knowledgeable FICO student on the board, I would not accept his opinion as gospel on this point. In my own personal testing I found that the number of highly utilized accounts did matter. Specifically I was testing, in EX FICO 8, whether the number of > 50% accounts had a score impact, even though the accounts were at the same utilization level. And my conclusion was that reducing the number of > 50% accounts having identical utilization levels did in fact increase the EX FICO 8 score.

I didn't really understand your hypothetical above, but if you want to know is it better to have two 20% cards than one 35% card and one 5% card, the answer is yes.

My hypothetical was that UTI on one card is the most significant factor, then have lower total UTI with a very low limit card at very high UTI was worse than having a higher total UTI with no single card at a very high UTI. Your contention seems reasonable in that it makes a difference but a large difference in total UTI will outweigh the individual card UTI mix.

Re: 3-month Plan For Maximizing Score

Jazee — Fri, 28 Jun 2024 04:48:05 GMT

Makes sense.

I'm testing a couple different new online banks as I'm not fully happy with mine. Grabbing a few extra bucks in the sign up bonuses in the process. One I gave a try is Chime. Don't plan on going with them as not a "real bank" in my opinion. Some interesting unique features though. One thing is they send all new account holders a secured Visa Credit card. This institution is very targeted at young customers trying to build credit. Was planning on just tossing and not activating the card. Is there any benefit to keeping and using it. Would be a hassle to keep refilling and using with any regularity so seems it would only lower my average account age.

Re: 3-month Plan For Maximizing Score

SouthJamaica — Fri, 28 Jun 2024 15:42:30 GMT

@Jazee wrote:
Makes sense.

I'm testing a couple different new online banks as I'm not fully happy with mine. Grabbing a few extra bucks in the sign up bonuses in the process. One I gave a try is Chime. Don't plan on going with them as not a "real bank" in my opinion. Some interesting unique features though. One thing is they send all new account holders a secured Visa Credit card. This institution is very targeted at young customers trying to build credit. Was planning on just tossing and not activating the card. Is there any benefit to keeping and using it. Would be a hassle to keep refilling and using with any regularity so seems it would only lower my average account age.

If they issued it to you it will probably show up in your reports and affect your aging stats, whether you activate it or not.