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This is common. What is your combined total utilization across all your cards? If it's too low that can cause score drops. But if it helps you keep yourself from overspending I'd say lower is better than having cards above ~30%. Don't fret the small points though. Just let them go up and down.
Hmm, do you have any other accounts? Also, where do you receive your credit scores? Fico Scores are known for having "false positives"... in which, for example, you receive a score drop and an associated change in your credit score, but the two may not necessarily be connected. I've noticed this a lot with MyFico. It's quite possible that your balance did drop, but that's not why your score fell.
Like the above person mentioned, having all revolving accounts report a zero balance can lead to a score drop - but I've only seen that happen with zero balances, not low balances. Did you happen to receive any hard inquiries recently?
@Anonymous wrote:Hmm, do you have any other accounts? Also, where do you receive your credit scores? Fico Scores are known for having "false positives"... in which, for example, you receive a score drop and an associated change in your credit score, but the two may not necessarily be connected. I've noticed this a lot with MyFico. It's quite possible that your balance did drop, but that's not why your score fell.
Like the above person mentioned, having all revolving accounts report a zero balance can lead to a score drop - but I've only seen that happen with zero balances, not low balances. Did you happen to receive any hard inquiries recently?
Good point asking for a source of scores. I know Credit Karma drops it's vantage score of your profile if you have a 0 percentage, rather than 0 balance.
@Anonymous wrote:
Hi. Thank you for responding. No inquiries lately. Check this out. I have a Navy Federal card with a $10k limit. My balance is $9,654. In Credit Karma is says that my score will drop over 20 points if I lower my balance to 9k. I don’t understand why my score would drop if I lower it by $654. Do you know why that would happen? I’m trying to raise my score by paying my balances down but now I’m scared. Any advice would be greatly appreciated.
I might be able to explain that. The card has $9,654 on it, but is that balance reflected on CK? As in, has having that high of a utilization already hurt your score? If it hasn't, then that is what CK is suggesting will happen - it will update from whatever it was before to that new balance and start to hurt your score. Alternatively, the simulator also takes into account a number of things, not just what you entered. For example, if an inquiry will age to a year next month, and you ask the simulator what would happen if you decreased your utilization from 3% to 2% next month, it will probably tell you that your score will go up - but that's not because you dropped your utilization, it's because that inquiry aged. The simulator will account for that and other things, even if you ask it about balances specifically. That being the case, it's also possible that your score will drop next month, but it's not because you paid down your balance! Strange, I know.
That being said, score simulators are just that: simulations. They may or may not be correct. Nevertheless, it is never a bad idea to pay down your balance, as long as you aren't paying it down to zero.
Like was mentioned before, ultimately Vantagescores aren't really used by anyone, so they don't really matter. I also use CK, but that's only for monitoring information on my CR - I disregard the scores entirely.