@MrsE wrote:I'm new to the FICO Forum Community, but have been working to increase my credit scores since a CH13 BR discharge in October 2019. My starting scores (in Oct 2020) were:
EQ (MyEQX and CK): 698
EX (EXP.com): 693
TU (CK): 693
I realize that the above scoring models are outside of the FICO model and can be a little off. I didn't start tracking my FICO scores until July 2021. In this model there are so many credit score versions, but currently my FICO 8/9 scores are (as of Feb 2022):EQX - 675/712
EXP - 700/731
TU - 677/725
I financed a car in February 2020 ($25K, owe $16K), purchased a home in Janury 2021 ($385K, owe $360K), have 3 credit cards (PNC - $14K, CapOne Plat $3.3K, Upgrade $13.5K), plus 2 personal loans (Lending Point - $25K, owe $7K) and Upgrade - $30K, owe $26K). My annual income is approx $226K.
Here are my other data points:
Credit Utilization: 17%
AAoA: EQX - 8 years; EXP - 6yr/8mo; TU - 6yr/9mo
Inquiries 12: EQX - 2; EXP - 2; TU - 2
My overall goal is to increase AND maintain a FICO 8/9 score across all bureaus of 780 or greater (850 would be ideal). My short term goal is to get my FICO 8 scores above 720 by December 22'.
Could use and would appreciate any advice to help me achive these goals.
Thank you!
Concentrate on (a) keeping your revolving utilization low, and (b) not applying for anything new, or for anything that could generate a hard pull.
@MrsE, our profiles have a lot of similarities:
- My Chapter 13 discharged five months after yours
- While the bankruptcy was still reporting my scores looked virtually identical to yours
- We have very similar income
- I have a few more inquiries than you over the last two years
The parts where our profiles diverge are as follows:
- I have no mortgage
- I have no car loans
- My only personal loan is a $3,000 SSL with a balance of only about $250
- I have three revolvers which usually report a total monthly balance of less than $100, typically on one card, but sometimes two
- My FICO 8/9 scores are as follows:
- EQ: 836/850
- EX: 817/838
- TU: 843/835
Long story short, my gut tells me your unsecured utilization is what is depressing your scores; I'm thinking if you pay off those two personal loans and keep your revolving cards mostly paid off, your scores will all pop up into the 800s.
Good luck and keep us posted on your progress.
@MrsE wrote:@Horseshoez - thanks so much! This is really helpful. I planned to pay off my LP personal loan and pay down my Upgrade loan to half of the balance since I just got it in December 2021. What are your thoughts? I know it's recommended to keep an account open for at least 2 years. Wondering if I pay off the Upgrade PL will my CS drop. Note: I've done this before with a credit card paying off $3K to bring the balance to $0 and my score dropped by 18 points. I was totally confused.
I was also going to payoff my car loan in September. Wondering if I should hold off or contine as planned? By then, I would have had the loan for 31 months.
As @dragontears correctlly pointed out, paying down the installment loans is NOT going to help your FICO 8 and 9 scores much. The revolving utilization is what counts.
When your aggregate installment loan utilization goes below 10% then you would realize a boost in those scores, but for your profile that would require hundreds of thousands of dollars.
When maintaining your revolving balances, let one bank card report a small balance each month before you pay it off. That is to avoid the "all zero" penalty which you no doubt experienced when your score dropped after paying a credit card account down to zero.
Your thought that keeping an installment account open for 2 years is meaningful is wrong; it doesn't matter one way or the other. But since your aggregate installment utilization will someday be a factor, it's just as well for your FICO 8 scores to keep mostly paid down loans open as long as possible, from a pure scoring perspective. But only when you get it all down to below 10% will you see any significant score improvement. For life purposes, it's often best to pay off an installment loan just for the peace of mind and simplification it provides, but for scoring it doesn't help.