HELP!! RECENT DROP IN CREDIT SCORES!!

[Anonymous]

I am reaching out to this forum to get  advice because I am very concerned about the recent drop in scores in both my husband's and I credit file. Last month, our scores were as follows:

My Scores:

EQ: 642

EX: 625

TU: 683

My husband's scores: 

EQ: 649

EX: 656

TU: 659

We recently paid down another credit card to 25% utilization, I waited 7 days to check our scores and they decreased. We have had no inquiries and no collections hit our credit files within the last 30 days. Our scores are as follows as of yesterday:

My scores:

EQ:644 (+2 points) 

EX:625 (stayed the same)

TU:682 (-1 points)

Not so bad right??? Take a look at my husband's scores:

EQ: 737 (+88 points) increase

EX: 636 (-20 points) decrease

TU: 607 (-52 points) BIG decrease

I can assure you we have not done anything except  pay our bills on time and have not applied for anything! The only thing that changed is our utilization. It went from 35% to 30% over all. I have looked at both of our credit files over and over and I cannot seem to figure out what the issue is. It seems to me that my husband's score would have increased significantly instead of decreasing.

Please let me know your thoughts as I am desperate in trying to figure this out. Your response is greatly appreciated!

[Anonymous]

FICO is not an exact science nor even a science. Usually, it is a combination of factors plus some odd FICO formula that causes this.

Consider whether any of the following may be the case in your situation:

* Older accounts that have been closed have aged off

*More accounts with balances than FICO feels comfortable with

*Any individual card (s) had a utilization increase, even if your overall utilization is still ok

*Different reporting times for cards. For example, if one card reports a few days before another, it can look as if your balances overall are higher because new payments are not showing yet.

*One or more cards not providing an update for that month. Comenity does this often when a card has a zero balance. Another lender may just have not provided an update.

* Balance transfers showing up on the recipient card but not yet subtracted from the donor card.

*Rebucketing.

*Bureau lag times. In my experience, EX reports changes faster than TU or EQ. EQ is as slow as a dinosaur in reporting payments and changes, and more than once they have reported silly things like n/a for my credit limit on one card, which was $15,000. Something like that alone would cause a score issue if you don't catch it.

Your file having a small increase is not an issue at all; FICO is fluid and does fluctuate. The large increases/ decreases in your husband's file would seem to indicate that something is going on. Check your actual reports thoroughly (don't just check scores) and that may provide some insight.

Order the full reports from each credit bureau directly. Sometimes these combination report services seem to offer abbreviated reports and not the same full report that the individual credit reporting agency offers.

[Anonymous]

"Older accounts that have been closed have aged off

*More accounts with balances than FICO feels comfortable with

*Any individual card (s) had a utilization increase, even if your overall utilization is still ok

*Different reporting times for cards. For example, if one card reports a few days before another, it can look as if your balances overall are higher because new payments are not showing yet.

*One or more cards not providing an update for that month. Comenity does this often when a card has a zero balance. Another lender may just have not provided an update.

* Balance transfers showing up on the recipient card but not yet subtracted from the donor card."

Thanks for the reply!! Unfortunatley none of the above applies to anyone one of us...We are both gardening at the time. We have 3 Cap1 cards btwn the both of us. He's an AU on two of mine and I am a AU on one of his...There are no balnaces to transfer because our total credit line with 3 Cap1 cards is $2K. I've ordered all 3 credit reports directly from them and can't seem to find the issue...

This is totally frustrating... 

[Anonymous]

You mention that you've ordered all 3 credit reports, but it sounds as if you haven't actually received them yet. No way to determine anything without having your reports in hand. Hope you ordered them directly from each bureau and not one of those all in one services.

How many accounts do you have with balances? That can be a factor as well.

As I mentioned, EQ has more than once reported ridiculous things like n/a for credit limit when it should be $15,000 for one card on mine. You need to check all areas of the report carefully once you receive it. There is no way for us to assist you unless you have actually seen the reports and can share specifics (not just having numbers for scores).

Rebucketing can definitely be a factor in score change if your husband has had negatives in the past.

Prior inquiries from 1-2 years ago dropping off one bureau and not others can also result in score changes, although not to the extent you describe.

You say you've had no inquiries or collections hit your reports in the last 30 days, but if you have prior ones that can factor into rebucketing as mentioned above. If you have any from even 90 or 120 days ago there could be a delayed reporting effect as well.

Any individual card company could have delayed reporting updates to any entry. Any individual bureau could also have delayed updating information.

Old accounts that you closed 10 years ago, if you have any, would be a factor and would be dropping your score after a 10 year period.

There are too many variables so unless you can provide more specifics, it will be difficult for us to help you further.

I'd check the scores again next month and see if there is a difference. 

[Anonymous]

I will check the scores next month to see if there is a difference.

Thanks again!

[Berk]

I can tell you this - I got a 5 point bump with one CRA for a lower balance on one of my cards and a 12 point drop with another CRA for the same activity on the same card. I paid off the remaining balance on a 10K  36 month loan after 18 months and received a 10-14 point drop across all three CRAs. It happens. I don't worry about it. Scores will go back up. As long as I maintain an upward trend in my scores I don't sweat the fluctuations that happen as a result of using other people's money.

[Anonymous]

This is true. My drop in scores doesn't bother me. It's the husband's significantt drop of 40-52 points that does... However, we will continue to maintain the "upward trend"... by paying our bills on time and keep the UTL down. My husband's credit file is REALLY thin though, so I'm hoping to have him apply for more credit within the upcoming months... His EQ reprt is clean and it's is highest score. I've been researching to see what cards he can apply for to pad him.

Thanks for the advice!

[Berk]

Your husband's file will get fatter with time. You have a good plan for using credit wisely. Friend's of mine, both in their mid 40s, have 840 scores. They have a mortgage, two joint credit cards that they pay in full every month, and a joint car loan. That is it. Time has been their biggest factor in getting them where they are.

[CYBERSAM]

I'm not going to speculate, but a score is computed based on a formula that has many variables.

A score is just a hindsight of what is going on with your credit report, therefore it is not the whole story! If you compare your Credit report from last month side by side then I'm sure you'll see what have caused the changes!

[Revelate]

Have to compare before and after reports when we're talking large swings.

Doesn't happen randomly, something assuredly changed (dispute?) but the devil is in the details unfortunately.  It's why I'm such a fan of CK is one can get weekly access to a credit report and compare for EQ/TU historical changes over time when something like this happens.