Accounts with balances

[CreditPoor]

My overall card utilization is 2%. I generally let 4 accounts post with a balance of $5 or $10 because I was getting dinged for letting all my accounts post a 0 balance when I paid them before statement closing. Now I'm getting dinged because they are reporting balances, You just can't win with this system. It doesn't reward you for being responsible and paying your debt. In a time where credit card debt is skyrocketing and delinquency rates are through the roof, you'd think FICO would encourage and reward people for being responsible and debt free

[JoeRockhead]

You're probably seeing a slight penalty for "having too many accounts with balances" try only letting 2 cards post small balances and see what happens. 

[NoHardLimits]

For me, the score ding for "accounts with balances" starts when I let 50% or more of my accounts report.  I've just learned to keep the number of reporting accounts to less than half.

[CreditPoor]

Do loan balances affect it? I have 2 pledge loans paid down to 97%. 

[JoeRockhead]

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@CreditPoor wrote:

Do loan balances affect it? I have 2 pledge loans paid down to 97%. 

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Loans are scored more by your on time payment history than anything... However, when you get down to one loan and the remaining balance gets down to under 9% of the original balance, most people see a decent jump in their scores. 

[GZG]

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@CreditPoor wrote:

Do loan balances affect it? I have 2 pledge loans paid down to 97%. 

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2 accounts with balances is worse than 1 account with a balance, so very slightly, yes. 

[CorpCrMgr1]

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@CreditPoor wrote:

My overall card utilization is 2%. I generally let 4 accounts post with a balance of $5 or $10 because I was getting dinged for letting all my accounts post a 0 balance when I paid them before statement closing. Now I'm getting dinged because they are reporting balances, You just can't win with this system. It doesn't reward you for being responsible and paying your debt. In a time where credit card debt is skyrocketing and delinquency rates are through the roof, you'd think FICO would encourage and reward people for being responsible and debt free

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I totally agree with you. I've played this FICO for years. It doesn't make sense.

[flexin222]

hey CP, there's no rhyme or reason, just the so-called ALGORHYTM. I've learned from trying to keep that FICO & CRYPTO climbing to just let God take the wheel. I'm sure we can help God by helping a little in a human way, but you get it. The 30% rule works and so do others that we've learned and In my humble opinion...They want us in debt! I've noticed over the years if you carry some debt and give up a little interest while not carrying the debt too long...The numbers go up. So, I've got debt and my numbers keep going up with no pullback, like cypto does. I'll let y'all know when I pay it all off. A little unsolicited advice from a my FICO bro non professional retiree...Buy and HODL Bitcoin, you won't be sorry!

[Zoostation1]

@GZG  Are you referring to loans only or revolvers too?  I agree on loans, but is there any significant difference if more than one revolver is reporting as long the percentage of accounts with balances is low?  I saw more of a negative on scoring (4pts on a dirty profile) from letting a card report 32% when AZEO (1/4 at the time) with  7.1%  aggregate utiilization than when I'm 2/5 with no cards crossing 29% and  8-8.5% aggregate reporting. FWIW this is all FICO 8 i'm referencing.

[GZG]

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@Zoostation1 wrote:

@GZG  Are you referring to loans only or revolvers too?  I agree on loans, but is there any significant difference if more than one revolver is reporting as long the percentage of accounts with balances is low?  I saw more of a negative on scoring (4pts on a dirty profile) from letting a card report 32% when AZEO (1/4 at the time) with  7.1%  aggregate utiilization than when I'm 2/5 with no cards crossing 29% and  8-8.5% aggregate reporting. FWIW this is all FICO 8 i'm referencing.

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I'd imagine it's going to depend based on the file, and the accounts with balances metric is small and won't be easily seen unless you're setting out to see the impact of it and arranging it perfectly, so it's the only potential factor that you're looking at

it also doesn't surprise me that going over 29% on one card is a worse score penalty than two accounts with balances

it also wouldn't surprise me if a clean profile had an even larger penalty for >30% on one card for <30% on two cards