@CreditPoor wrote:This is absolutely ludicrous, my buddy consistently reports zero balance on all cards for what seems like forever. Yes, he accepts the AZEO penalty it's a principle thing. Having said that, I'm at his house and he gets a FICO score change notification and it's a 9pt drop. One of his CP1 card's reported a $500 balance on a 5k limit for the first time and bam he gets hit. He has 36k in credit across 11 accounts and takes a hit for $500, fam something is wrong with this
I figured something else hit his report at the same time but nope it's clean and that was the only change
Neither 1.4% aggregate revolving utilization nor 10% individual account utilization would cause any downward pressure on a FICO 8 score. So I doubt that the $500 balance was the cause of the score drop.
To determine what caused the drop, you would need to know the date the score changed, and you would need to make a line by line comparison of the report from the day before the score change and the report from the day of the score change.
BTW there's no "AZEO penalty", it's an All Zero Penalty. If your buddy has been running all zero's he would have been receiving the all zero penalty, and the reporting of a $500 balance would actually have increased -- not decreased -- your buddy's scores.
So yes, using your assumptions, it makes no sense. But your assumptions are unfounded.
@Anonymous wrote:
@SouthJamaica wrote:
@CreditPoor wrote:This is absolutely ludicrous, my buddy consistently reports zero balance on all cards for what seems like forever. Yes, he accepts the AZEO penalty it's a principle thing. Having said that, I'm at his house and he gets a FICO score change notification and it's a 9pt drop. One of his CP1 card's reported a $500 balance on a 5k limit for the first time and bam he gets hit. He has 36k in credit across 11 accounts and takes a hit for $500, fam something is wrong with this
I figured something else hit his report at the same time but nope it's clean and that was the only change
Neither 1.4% aggregate revolving utilization nor 10% individual account utilization would cause any downward pressure on a FICO 8 score. So I doubt that the $500 balance was the cause of the score drop.
To determine what caused the drop, you would need to know the date the score changed, and you would need to make a line by line comparison of the report from the day before the score change and the report from the day of the score change.
BTW there's no "AZEO penalty", it's an All Zero Penalty. If your buddy has been running all zero's he would have been receiving the all zero penalty, and the reporting of a $500 balance would actually have increased -- not decreased -- your buddy's scores.
So yes, using your assumptions, it makes no sense. But your assumptions are unfounded.
Except the same exact thing happened to me last year when I changed from
"-all zero penalty- paying all balances before statement cut"
to
"PIF before due date"
I would have to dig through statements to recreate the #'s, and not going to happen. But I know my numbers were very similar to what @CreditPoor is saying. Though both my aggregate and individual utilization would have been less than 2-3%
I wasn't bothered by it, though I was very confused. Research I had done said the opposite would happen. I was thinking maybe at least a few point increase. NOPE. All 3 bureaus tanked 15-20 and it may have been more. Took a few months for my scores to bounce back up a few points at a time.
This is the 1st time since then I have seen someone post a similar occurrence to mine.
And yes, I had went line by line looking for ANY change besides having gone from being a "zero reporter"
Yes but
(1) did you know the actual date of the score change (not the date you learned about it)?
(2) were you able to get a copy of your credit report from the exact day before that change?
(3) were you able to get a copy of your credit report from the exact day of the change?
I imagine that the answer to all 3 of the above is probably "no".
I know it seems to make no sense, but hear me out. The OP, and Mr. Schmidt both site the factor of going from 0% usage, to usage. In particular @CreditPoor sites an extended period of time in which there was 0% usage. I would agree the 10% UTI as it's own threshold on a single card is unlikely.
However, putting the possibility of a scorecard reassignment aside, I would say that being there was no usage for an extended period of time followed by a reported balance (which just happened to be 10%), the friend was assessed a slight score penalty for triggering a higher risk assessment, or said another way, they reset (in a sense) the risk assessment algorithm of their file by going from 0 to $XXX reported balance.
A 9 point drop is really insignificant. Many people take more of hit than that for a single HP during a credit application. I'd be willing to bet that if the friend paid down that balance (but not to zero), they'd see their points back, and likely more. It would be a good experiment in the name of science... and provide some good DPs for others who might experience these otherwise illogical occurrences.
@Anonymous wrote:
@SouthJamaica wrote:Yes but
(1) did you know the actual date of the score change (not the date you learned about it)?
(2) were you able to get a copy of your credit report from the exact day before that change?
(3) were you able to get a copy of your credit report from the exact day of the change?
I imagine that the answer to all 3 of the above is probably "no".
Your imagination aside.
1. Why yes. Yes I did know the exact date the scores changed.
How did you get that date?
2. What could possibly be different about reports from the "exact day" previous and reports that were pulled 7-10 days previous?
A lot of things can happen in 7 to 10 days. In any event, you would need to see what did or did not change between the day when the score was lower and the day when it went higher.
3. Why yes. Yes I did get copies of my reports from that day on that day,
Too bad you didn't have the report from the day before to which to compare it.
but what could possibly be different about a report from that day and one from a week later?
All reports were identical to each other. Besides the newly reporting balances.
That seems unlikely, since you said you "changed from
"-all zero penalty- paying all balances before statement cut"
to "PIF before due date". Sounds like a number of accounts were involved.
I'm not trying to give you a hard time. I'm just tired of people posting information that is not necessarily true, and then other people relying on it. I can just picture seeing posts in the future "I read somewhere that 1.4% utilization causes a 9 point score drop" when it is simply not true.
If you don't know the exact date the score changed, and can't compare that day's report to the report from the day before, you really can't know if the conclusion you've drawn is valid or not.
The only tool of which I am aware that can provide that kind of information, other than the prohibitively costly 3 bureau reports on MyFICO, is the experian.com site with its paid services that provide daily updates of one's experian report and 7 key FICO scores based on the experian data.