How many points

[Anonymous]

I used to have a higher credit score, but the last time I checked it was 690. I was absolutely shocked as I thought my credit was excellent and don't understand how it got so low. I even called credit counseling services and they said they couldn't understand why it was so low either because everything is paid ahead or on time. I would like to know how many points you get dinged for different things.  Is that posted somewhere? I had heard that if you apply for credit it's 6 points, if you close a card it's 6 points etc. So for me to drop 50 - 100 points it must be a lot more than that. The only two things that I think could have hurt me is that I opened a HELOC last year, but only have a 15k balance on 75k available, and I bought a motorcycle with dealer financing. My car loan only has 6 months left to pay on it, and my mortgage is paid ahead of schedule. All my credit cards either aren't used or the balance is paid in full at the end of the month. At this point I am pissed at the whole credit scene and intend to pay off my home, car and bike and never borrow another penny! I took the FICO estimator and it said I should be between 735 and 785. So how much does it ding you when you open a HELOC or get dealer financing? It must be more than 6 points. Is that listed somewhere?

[MidnightVoice]

Have you got actual FICO scores and looked at your Credit Report for errors?

[Anonymous]

Yes. Again, my question was, is there a listing of points charges? My credit reports from all three look perfect. Even the guy from consusmer credit counseling was baffled. If he doesn't know than who does? Where do I need to go to get information? I would like to know where to find the information about how many points are being charged for opening a HELOC and getting dealer financing. It should be public information like ATM fees or something.  You should be told that applying for a HELOC is going to be so many points, etc.  I don't think it was only 6 or 7 like people talk about on the posts. Who is charging these points? Is it Fair Issac?  If Fair Issac is providing credit score data, shouldn't it be broken down as to the damage that each action is inflicting on the score?

[cobaltnv]

Marbles,

  Your FICO score is a snapshot of your credit risk. The calculation takes many different things into account many of them presumably intermingled. Therefore, while many on here have attempted to quantify what each action will cost/net you in points it is not that easy. It depends on your bucket and a variety of other factors.  

[SCF]

Hey Marbles, welcome to the forum!

I'm sorry to hear your credit score isn't doing as well as you'd like it to be, but I'm sure we can puzzle it out.  To answer your question about how many points certain things "cost" your credit score, the short answer is that no one knows exactly.  The FICO model is proprietary and its exact workings are a trade secret.  We know a lot about what makes scores go up and down and what is generally good or bad, but the exact point changes for each action is based on too many variables for us to be able to calculate it.  FICO also uses scoring "buckets," which are kind of like prices for airline or rail fares, when you move into a different bucket, somewhat different rules apply to your score because FICO scores are not just about your credit, but how your credit compares to other people like you.  There are some good threads on buckets and scoring, just give the forum a search and read the stickies.

Now, another question, where did you get your credit score from?  Also, have you looked at all three reports (EQ, EX, and TU) to double check that there are no collections, liens, judgments or anything else negative that may have been added in error?  Finally, if you can give us a general overview of your credit (average age of accounts, number of CCs with their limits and balances, any negative information like late payments, charge-offs, etc.) the folks here can definitely help you pinpoint areas that you can improve.

Good luck!

[Anonymous]

Thank you for the welcome! Since I can't reread your email while I am replying, I will try to answer what you asked from memory.

I have had a mortgage for 9 years on this place. I have two prior homes that I sold, paid off at the sale and was never late. I have a car payment that is 4.5 years old. It has a 4% interest rate and is automatically paid from my checking account. Never late. I had a prior car payment that was paid in full never late. I had two previous motorcycles that were paid in full and never late. The current one I financed through the dealer to get the initial interest rate. It was (oddly) financed as a credit card through Household Bank - so of course it looks like I have a maxed out card from them. In reality, I have paid over the amount and was never late. I have paid off student loans that are over 10 years old. I have about 7 credit cards (lets say $70k) with zero balances. And I have a HELOC that has a $15k balance on $75k available - never late. I have no collections, no late payments, no bad comments, nothing that would make a 780 credit score go to 690 that I can see. The only thing is that the HELOC and the bike financing were both opened last year. So I have to assume that those two things crashed my score almost 100 points. I think if that's the case, consumers should be warned that their credit is going to take a hit. I called my credit union to transfer my bike loan because the introductory rate is almost over. They said I would not get the prime rate because of my credit score, but the bike loan, (I am guessing) is what crashed my credit score in the first place. I would have never agreed to Household Bank Credit Card if I knew that is what it would do. I would have had my credit union finance it in the first place. I think it is unjustified to penalize me this way for otherwise perfect credit. There should be a statement of "points" that they will charge you before you accept the credit terms.

[Anonymous]

I guess the short of it is that I don't see anything I can do to make it better since I don't have any "issues". The only thing I can do is not open any new accounts, pay cash for everything, and get 99.9% out of debt. By the way, I only owe $35k on my mortgage so my total debt of everything in the world is about $60k.  I have a beautiful 2-acre lot in N. Florida that would probably pay off everything even in this market. Anybody interested? :-)

[SCF]

I think you have it right Marbles, the motorcycle loan is probably what caused the drop in your score.  If it is reporting as a revolving account it will be factored in your utilization, and having nearly 100% utilization on a card suddenly can cause your score to drop quite a bit.  Also, high scores (like yours) are prone to drop more substantially than low scores because of the buckets I mentioned in my other post.  What is the limit and balance on your bike loan and when was it opened?

Refinancing that bike loan to a standard auto loan (which will appear as an installment loan and not affect your utiliation) may well be the best thing you can do for your scores.  I'm sure some other experts will pipe up, but maybe you could explain to your CU the issue with the utilization on the revolving account affecting your scores and see if they would be willing to refinance you again in a couple months once that drop in util drives your scores back up?

[Anonymous]

I am just surprised that one loan caused such a whack that I certainly wasn't expecting. And I didn't understand when I was applying for "dealer" financing that it was a credit card and not just a regular loan. Since the CU offered me 9.9% though, I wasn't very happy with the deal and am planning to pay for it with my HELOC. The bad news there is that will make my HELOC about 28k to 75k; higher ratio than I would like to have, but the interest rate is 5%. Since I will then only have 1 payment, I can  probably pay about $1k a month to make it go back down, but unfortunately, I have already experienced the bad affects of the lower FICO. I guess I will just be eating noodle soup until that HELOC is paid off.

[haulingthescoreup]

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Marbles wrote:

...The bad news there is that will make my HELOC about 28k to 75k; higher ratio than I would like to have, but the interest rate is 5%. Since I will then only have 1 payment, I can  probably pay about $1k a month to make it go back down, but unfortunately, I have already experienced the bad affects of the lower FICO. I guess I will just be eating noodle soup until that HELOC is paid off.

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HELOC's with a credit limit of over $40K or so are not factored into revolving util. The TU simulator acts as if they are, and you'll see the balance included with revolving on your Credit-at-a-Glance screen on EX, but as best as we can tell, it won't truly affect your score.

I have a HELOC with a $50K limit, and I have never seen a change in scores when the balance either increases or decreases.

Message Edited by haulingthescoreup on 12-26-2008 05:47 PM