@sarge12 wrote:
@K-in-Boston wrote:Negative balances will be reported as $0. It will only "hurt" if you have no revolving credit cards reporting a positive balance on your credit reports, but utilization is temporary and as soon as any account reports a positive balance any points lost would be regained.
That is true on fico 08, and fico 09, but with 10T on the horizon, treating utilization as a point in time metric might not be advisable. Point being, on 10T, the fact that all points lost due to utilization will be recovered may not be the case. It might be a good time to start keeping utilization in ideal condition at all times. That way when using historical data, there will not be any bad utilization history to drop those scores. The days we can say points will all be returned if lost because of utilization may be at an end. 10T might be a game changer for how we treat utilization.
You have a point, but realistically, 10T may take a while before it is widely adopted, if ever. I mean 95% or so of lenders are STILL using 08, which is over a decade old at this point. 09 came out since then and it also hasn't been widely adopted yet.
@sarge12 wrote:
@OmarGB9 wrote:
@sarge12 wrote:
@K-in-Boston wrote:Negative balances will be reported as $0. It will only "hurt" if you have no revolving credit cards reporting a positive balance on your credit reports, but utilization is temporary and as soon as any account reports a positive balance any points lost would be regained.
That is true on fico 08, and fico 09, but with 10T on the horizon, treating utilization as a point in time metric might not be advisable. Point being, on 10T, the fact that all points lost due to utilization will be recovered may not be the case. It might be a good time to start keeping utilization in ideal condition at all times. That way when using historical data, there will not be any bad utilization history to drop those scores. The days we can say points will all be returned if lost because of utilization may be at an end. 10T might be a game changer for how we treat utilization.
You have a point, but realistically, 10T may take a while before it is widely adopted, if ever. I mean 95% or so of lenders are STILL using 08, which is over a decade old at this point. 09 came out since then and it also hasn't been widely adopted yet.
That may be true, but if it takes 2 years, and they use trended data for 2 years, what we are doing now will be included. Now is the time to consider trended data, so you do not have to suffer a drop in 2 years if 10T is used. From some things I have read, many lenders have been pushing for trended data for years, so the adoption of the 10T might be quicker than we might think by a lot of lenders.
It could, or it could take 10 years before it's adopted, or it may get bypassed altogether and FICO 11 may get adopted instead. We don't really know, so we can't say what we should or shouldn't do, but I do agree that in general it's best to try to keep balances low, not just for possible future iterations of FICO, but also just to avoid getting on any of your creditors' radar for possible AA.
In any case, we're derailing the thread a bit, so let's get back on topic. The topic of 10T or other new versions can have its own thread.