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EXTREME decrease in scores

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EXTREME decrease in scores

My credit scores were 667 eq, 670 tr, and 650 ex now my scores are back down in the dang 500’s. HELP!! The things that change were closing the selflender account paid in full and my 2 credit cards balance increased along with one having me on as an authorized user. How can I fix this again I’m so disgusted in this result.
Message 1 of 11
10 REPLIES 10
Valued Contributor

Re: EXTREME decrease in scores


@Confused19 wrote:
My credit scores were 667 eq, 670 tr, and 650 ex now my scores are back down in the dang 500’s. HELP!! The things that change were closing the selflender account paid in full and my 2 credit cards balance increased along with one having me on as an authorized user. How can I fix this again I’m so disgusted in this result.

I would be guessing, but was the selflender an installment loan? Was it your only installment or non-revolving loan? Points lost due to higher utilization are easy to recover the lost points if you have the funds to pay them off and only allow a small balance to report from 1 card. Not having any non-revolving accounts will cause a fairly large drop, but if it dropped over 100 points there is likely something bad that just started reporting...collection, judgement, etc. In the 500's could mean 599, if so no longer having non-revolving account open might make that much difference along with high utilization.

TU fico08=823 08/20/19
EX fico08=813 08/10/19
EQ fico08=826 08/04/19
EX fico09=818 08/03/19
EQ fico bankcard08=849 07/23/19
Message 2 of 11
Established Contributor

Re: EXTREME decrease in scores


@Confused19 wrote:
My credit scores were 667 eq, 670 tr, and 650 ex now my scores are back down in the dang 500’s. HELP!! 

So are we talking about the mid or upper 500's? Also what is your AAoA and AOoA?

 

 


@Confused19 wrote:
The things that change were closing the selflender account paid in full...

Up to 20 points can be lost when an installment loan closes.

 


@Confused19 wrote:
The things that change were ..... my 2 credit cards balance increased along with one having me on as an authorized user.

How much of an increase are we talking about?











Current

Goal Cards

Message 3 of 11
Contributor

Re: EXTREME decrease in scores


@sarge12 wrote:

@Confused19 wrote:
My credit scores were 667 eq, 670 tr, and 650 ex now my scores are back down in the dang 500’s. HELP!! The things that change were closing the selflender account paid in full and my 2 credit cards balance increased along with one having me on as an authorized user. How can I fix this again I’m so disgusted in this result.

I would be guessing, but was the selflender an installment loan? Was it your only installment or non-revolving loan? Points lost due to higher utilization are easy to recover the lost points if you have the funds to pay them off and only allow a small balance to report from 1 card. Not having any non-revolving accounts will cause a fairly large drop, but if it dropped over 100 points there is likely something bad that just started reporting...collection, judgement, etc. In the 500's could mean 599, if so no longer having non-revolving account open might make that much difference along with high utilization.


Sarge12 dropped a knowledge bomb, if self lender was your only installment loan. You scoring change plus having higher credit UTL. As long as you did not have any missed payments or derogs report you will be fine as long as you lower your credit UTL again, and get a new (OPEN) installement. If you already have an open installment then the balance has something to do with the lower score also.




Started from the bottom now I'm here. Smiley Happy
Message 4 of 11
Frequent Contributor

Re: EXTREME decrease in scores

Is that credit score from Fico.Paying off  the balance and closing your only open installment loan would never lower your Fico score over 100 credit score points.Its will lower your Fico 8 score about 30 credit score points at best.Whats much more important is that you pay all of your credit accounts monthly on time,avoid any derogatory information and keep cc utilization 1-6% on all cc's. GOOD LUCK...

Message 5 of 11
Valued Contributor

Re: EXTREME decrease in scores


@DIYcredit wrote:

Is that credit score from Fico.Paying off  the balance and closing your only open installment loan would never lower your Fico score over 100 credit score points.Its will lower your Fico 8 score about 30 credit score points at best.Whats much more important is that you pay all of your credit accounts monthly on time,avoid any derogatory information and keep cc utilization 1-6% on all cc's. GOOD LUCK...


I do not agree....how many points would be lost by closing your only installment loan, is subject to how much other data is in his/her report. If you only have a thin file with that one loan and only 3 credit cards, that accounts closing would be magnified. Very thin credit files react worse with almost any changes. If you have 20 credit card accounts and close 2 of them, there may be no effect on scores at all, If however you only have 3 credit cards and close 2 of them, expect a significant hit. All actions affect on a credit score is largely dependent on the individuals credit profile, so we can't really say it would affect it no more than 30 points.

TU fico08=823 08/20/19
EX fico08=813 08/10/19
EQ fico08=826 08/04/19
EX fico09=818 08/03/19
EQ fico bankcard08=849 07/23/19
Message 6 of 11
Frequent Contributor

Re: EXTREME decrease in scores

I agree to a certain degree with what you are saying.No single action reported to your credit report has any exact Fico score value,but keep in mind credit mix only accounts for 10% of your credit score.Your credit score would only  take a significant hit when you close the two cc's and now the credit limit is no longer considered into open cc's utilization and now with one open cc let's say you are now maxed out your credit limit and now have high ovarall cc utilization.That's the only way I see a significant hit.Every credit account ages open or closed as long as it is present on your credit report.Thin files is age related and has nothing to do with utilization.I agree with credit mix that would be a more important factor for someone with a thin file,but so would opening a new credit account which lowers aaoa plus the hard inquiry.I don't believe closing an installment loan or opening a new credit account would lower any fico score over 100 credit score points.Any credit file will have the most significant damage because of new negative information being posted on their credit report and high overall cc utilization.

Message 7 of 11
Valued Contributor

Re: EXTREME decrease in scores

I agree credit mix is only 10% of a credit score, and utilization is 30%, and both can be part of total debt. The vast majority of the OP's lost credit points will likely be returned by simply getting all credit cards utilization back below 8.9%, with no single card being over 29%. Then only the points lost by not having an installment loan open will be evident.

TU fico08=823 08/20/19
EX fico08=813 08/10/19
EQ fico08=826 08/04/19
EX fico09=818 08/03/19
EQ fico bankcard08=849 07/23/19
Message 8 of 11
Frequent Contributor

Re: EXTREME decrease in scores


@sarge12 wrote:

I do not agree....how many points would be lost by closing your only installment loan, is subject to how much other data is in his/her report. If you only have a thin file with that one loan and only 3 credit cards, that accounts closing would be magnified. Very thin credit files react worse with almost any changes.

They sure do! My Experian FICO 8 dropped -81 points when the only account on my credit file, an SSL, reported closed.

 

On that same day, the 2 new credit cards (my first revolving accounts ever) reported at 1% aggregate utilization and the score went up +51 points. (See Experian Creditworks alert graphic below. myFICO alerts only show me the final result, -30 points.)

 

My very first inquiry on EX in December cost 19 points. At EQ it was 20 points.

 

experian-jan4-pre.pngRead from bottom to top.

27 FICO Scores + 3 VS3. MTG (Mortgage), AUT (Auto), and BKC (Bankcard) are scores 5,4, and 2 from the top.
Message 9 of 11
Valued Contributor

Re: EXTREME decrease in scores

@CassieCard....I just generally shy away from speculating how many points will be lost due to an action, period. Credit Profiles are often vastly different between any two people, and due to such two individuals can take the same identical actions and have vastly different results. I as a general rule always pay in full every single credit card. If I all of a sudden started carrying a balance on all my cards, it might raise a red flag, solely due to that being unusual for me. For the debtor who always carries a balance, that would be his usual way of using cards, and would cause no concerns for the issuers. The OP stated a huge drop when installment loan paid off, and his balabnces on credit cards went up. The best I' or anyone can do is make a guess on which actions caused to greater point drops. Without much more info on his credit history, it is not even an educated guess. The best way to know the effect of the closed out loan is to employ azeo to get all utilization points back and compare it to his previous score before the loan paid off.

TU fico08=823 08/20/19
EX fico08=813 08/10/19
EQ fico08=826 08/04/19
EX fico09=818 08/03/19
EQ fico bankcard08=849 07/23/19
Message 10 of 11
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