topic Re: Can I get from 615 to 640+ FAST this way? in Rebuilding Your Credit

Can I get from 615 to 640+ FAST this way?

Anonymous — Tue, 15 Aug 2017 03:27:50 GMT

Hi all. I want to take out a Home Equity Loan to consolidate and eliminate all of my debt plus put a new roof on my house, but my FAKO scores are 615-630 so I don't want to apply before I'm confident that I can raise my score above 640 to qualify. My FAKO scores have been in this same range for a couple of years now. My home is worth about $175,000 and is completely paid off. I calculate my Debt-to-Income ratio at under 20%.

I have about $7,000 in CC debt and $10,000 in an installment loan. My last late payment on anything was a 30-Day in 2014, but I recently found out there is an erroneous outstanding medical collection on my credit report for $500 from a few years ago. It was paid by insurance but for some reason is showing in collections so I just filed a dispute with all three agencies.

Other than the above, I don't know why my score is so bad. I'm wondering if it's because of my high utilization on two of my CCs? My overall utilization is 35-45% (depending on which FAKO), but my two highest limit cards are each at about 85% of their $2k limit (they have the lowest interest rate by far).

I would like to get my score above the 640 mark as fast as possible. Other than trying to get the medical collection taken off my report (even if ultimately I'm forced to "pay to delete"), my current thought is to get those two $2k cards down under 30% utilization each (which would also bring my total utilization down under 30%).

So my bottom line question is, if I just throw $3,000 right now at those two credit cards, what are the chances that I could go from a 615 to 640+ in a hurry? Decent? Low? What else can I do?

Thanks for any help!

Re: Can I get from 615 to 640+ FAST this way?

medicgrrl — Tue, 15 Aug 2017 03:31:23 GMT

You should pull your FICO score. I would contact the lender you plan to use and ask them what version of FICO they use.

Re: Can I get from 615 to 640+ FAST this way?

Anonymous — Tue, 15 Aug 2017 03:39:04 GMT

Took your advice. Interestingly, my FICOs are better than my FAKOs. Still not feeling very confident though and wondering what I should do next to give myself the best shot at approval... The "FICO Score Simulator" guesses that paying off all $7,000 of my CC debt would only take my score from 656 to 696...

Equifax: 640

TransUnion: 650

Experian: 656

Re: Can I get from 615 to 640+ FAST this way?

medicgrrl — Tue, 15 Aug 2017 03:44:51 GMT

I would contact the medical provider directly regarding the collection to confirm they show that it was paid by insurance.

If you can bring your overall utilization below 29% and not have any of your cards above 69%, that should improve your scores also.

Re: Can I get from 615 to 640+ FAST this way?

Anonymous — Tue, 15 Aug 2017 03:49:24 GMT

Digging deeper I see that my FICO Score 8 is 640+ across the board, but my FICO Score 2 ("Commonly Used in Mortgage Lending") is down around 620 for each.

I have four negative score factors for FICO Score 2:

You have a serious delinquency or derogatory indicator, public record and/or collection on your credit report. ($500 medical collection)
You've made heavy use of your available revolving credit.
You have one or more accounts showing missed payments or derogatory indicators. (some old 60, 90 days late from 5+ years ago on accounts that were either paid off in full or have been in good standing for years now... anything I can do about these?)
You have a short credit history. (oldest account is 14yrs but average is only 5yrs)

Re: Can I get from 615 to 640+ FAST this way?

medicgrrl — Tue, 15 Aug 2017 03:55:58 GMT

I would start with that collection. That's hurting you the most, then the utilization. If you have time, you can write GW letter's for the late payments but they really aren't hurting you as much as that collection.

Re: Can I get from 615 to 640+ FAST this way?

rmduhon — Tue, 15 Aug 2017 10:43:22 GMT

What is your overall utilization and your utilization per card?

Re: Can I get from 615 to 640+ FAST this way?

Anonymous — Tue, 15 Aug 2017 12:02:41 GMT

Well according to FICO my total utilization is 68%. It looks like the FAKO scores I was looking at previously were giving me utilization credit for a joint card I've had with my wife for years, but FICO is not. I have two cards each with $2k limits that are over 80% utilization, a number of other cards ranging from 40-60%, and two around 10%.

Re: Can I get from 615 to 640+ FAST this way?

rmduhon — Tue, 15 Aug 2017 12:05:55 GMT

The 2 cards over 80% is hurting you bad. As for score simulators, you'll get results that are jyst as accurate if you throw a dart .

Re: Can I get from 615 to 640+ FAST this way?

Anonymous — Tue, 15 Aug 2017 12:37:57 GMT

1) Please stop with the 'FAKO' score, they clearly let you know they are different, based on different criteria, knowing using an alternative ruler then being surprised the numbers aren't the same is kinda, silly.
There gauges, best used for tends, that their value leave it at that or completely ignore them

2) At one point you indicated that your main 2 CCs were at 85% utilization... that's HUGE!!!

Sure all the little things mentioned by others on this thread are valid, however 85% utilization is a score KILLER!

This is RISK scoring...the FICO model essentially is gauging the current RISK of the next plate one has juggling in the air of falling....if the model sees an 85% utilization, let alone 2 it's gonna take note.

Remember 30%, the second largest portion of the score is utilization of CL and 85% is considered essentially maxed out.

There is a HUGE difference between 85% and say 25% RISK wise...I really think you can the 20-30 point swing you're looking for is right there in utilization, which is good news cause you can control, that on your own

In addition, having balances on more than 1 card also indicates RISK but it is yet another aspect that you can control and manipulate the scoring model.

Once you 'get' what makes the model 'real' out regarding RISK you can manipulate the situation

High utilization
Balances on several cards

Make the model nervous of plates falling, address those concerns she feels more comfortable and the RED threat meter goes back to Orange or Yellow etc

(85% may as well be screaming "We're going DOWN" in terms of a "snapshot" ( which scoring is) of the situation
Nothing to be overly concerned about IMO because it's controllable and in YOUR hands and ability to address)

The cautionary tale here is we must be mindful of WHEN, we pull the trigger on things like Home Equities or PL etc. moving debt from revolving evaluation because the catch-22 is if we allow the utilization to Rob us of too many points, then the score may be to low to solve the problem

Ex: Getting a CLI from 2k to 5k would greatly change the % or debt on said card but if the score has been drained to the point the CLI wouldn't be approved, then what?

Just sharing that I know, it can be frustrating but warning others to take ACTION as early as possible to DEFEND yourself before options let thin

Best of luck

Re: Can I get from 615 to 640+ FAST this way?

Anonymous — Tue, 15 Aug 2017 12:52:26 GMT

Thanks for this. I think I can pretty readily throw 3-5k at my CC balances right away, I just want to make sure I have a good understanding of what the likely result is going to be before making the move. If I pay down 5k and my score only improvies by 5 points, it's going to put a hurt on me. I really need to figure out how to get to where I need to be to have a good shot on the Home Equity Loan.

So trying to formulate my plan of attack here... if my two 85% cards are a combined balance of say $3600, should I throw $3k at them to get the utility down to about 15%, and then also completely pay off a couple of cards with low balances in the $250-500 range?

Re: Can I get from 615 to 640+ FAST this way?

Anonymous — Tue, 15 Aug 2017 13:56:21 GMT

Ok
1) It ain't gonna be 5 points so let's calm down with the dramatic swings you'll give yourself a heart attack 😊

2) In fairness, it's hard to give exacting numbers in risk modeling, especially on limited info

You ask about shifting % of 2 cards, then you ask about low balances on X amount of additional cards...
Which is no big deal but again to be fair

How many cards with balances would we be left with at that point?

To be crystal clear, when I say the model prefers ideally zero balance in a perfect scenario... unfortunately it's not hyperbole the model sees $5 as having balance, so to be honest $250-$500 balances or a $5 balance nips the score just the same
Again, only for that specific scoring criteria ( I like to be accurate) the 'risk' of having multiple cards with balances doesn't take into account the amount, just that it exist, period...the dumb model is just written has a yes/no true/false issue much like the paid on-time points it's either yes/no not was it a big payment vs a small payment... it's simply check yes/no

I share this just to show there many moving parts no matter how simple someone wants to oversell it

Will you be better off w/o 85% utilization confidently Yes
Will it still be not ideal to have a bunch of cards with balances of any amount Yes

Would it be prudent to retire balances on as many cards as possible even if it means the last 2 are at a not ideal 60%...
Hard to answer w/o considering HOW MANY are we talking here 5-10-15 ... going from 9 cards with a balance to 1-2 will get a bump even if the final 2 are still above 30%

Also are any milestones happening during this process, has an account reach a birthday, has the profile crossed another milestone of some sort

Again lots balls in the air...all we can really do is get as close to ideal as we reasonably can, while still living our lives as comfortably as possible

Personally, I don't see it being a problem for you getting the 20-25 points you're looking for but I answer questions in a as full as I can way so that others reading won't get a narrow idea w/o at least understanding more is at play that might need to be addressed because barely any of this stuff happens in a vacuum
I think you'll be fine

Could throwing that $3-5k take you from 9 cards with a balance to 2 (even with the high utilization) or if it's gonna still be a bunch more with balances anyway, then it's a different tactic... devil's always in the details you don't know 😂

Re: Can I get from 615 to 640+ FAST this way?

Anonymous — Tue, 15 Aug 2017 14:08:15 GMT

So I think I have 7 cards total with balances, or 8 if an Amazon store card counts in the same vein for scoring purposes here. I have the two cards around 85% of their $2k limits, and then 5 more each with balances between $250-1000.

Unsure about any upcoming "milestones"... I guess I didn't realize that was a thing?

Re: Can I get from 615 to 640+ FAST this way?

medicgrrl — Tue, 15 Aug 2017 14:10:20 GMT

Before you put all of your money towards your cards, check on the collection and make sure you don't actually owe that money. If you do owe it, you may be able to do a pay for delete.

Regarding cc balances, FICO weighs heavier on aggregate utilization than individual card utilization. Utilization thresholds appear to be 9%, 29%, 49%, 69% and 89%. It's when you cross the threshold you see the score improvement. Having overall utilization below 9% with individual utilization below 29% along with less than 50% of your cards reporting a balance will give you the greatest scoring impact.

Removing the collection and bringing down utilization below the next threshold will give you a good bump in your scores.

Re: Can I get from 615 to 640+ FAST this way?

Anonymous — Tue, 15 Aug 2017 14:18:08 GMT

The above is exactly what I'm looking for! Thanks for shedding some light there. Going to research this exact combination and see what I can come up with. Thanks!

Re: Can I get from 615 to 640+ FAST this way?

medicgrrl — Tue, 15 Aug 2017 14:19:58 GMT

Good luck! Come back and update us on your progress.

Re: Can I get from 615 to 640+ FAST this way?

Anonymous — Tue, 15 Aug 2017 14:27:49 GMT

Do consumer cards like the Synchrony Amazon factor the same way into these calculations as normal CCs?

Re: Can I get from 615 to 640+ FAST this way?

medicgrrl — Tue, 15 Aug 2017 14:28:27 GMT

Yes, they do.

Re: Can I get from 615 to 640+ FAST this way?

Anonymous — Tue, 15 Aug 2017 14:30:37 GMT

Agreed, update us on what you did and your progress

The term 'FAST' always throws me because one doesn't know if it's just nervous excitement or if the person absolutely means what can I do literally in the next 10 days😀

Again,
Best of Luck

Re: Can I get from 615 to 640+ FAST this way?

Anonymous — Tue, 15 Aug 2017 14:36:03 GMT

Btw don't worry about milestones my only point was sometimes we get unexpected bumps based on something seemingly arbitrary that can factor in as a 'win' and not knowing it happened it causes ppl to sometimes think it was some other action they took but it's spy-double-spy stuff for another day😊