AZEO and AU Accounts

Anonymous · ‎06-30-2021

I have 3 CC Accounts that are open.

My first is an Open Sky Secured with a $200 limit since January. I've been paying it to a $2-6 dollar balance every month.

My 2nd is a Wells Fargo card that I'm an AU on. It has a $7000 limit and usually reports at 6% utilization.

My 3rd is another bank card that has a $10,400 balance that has a $0 balance every month. I am an AU on this one too.

My question is since the Open Sky is my only Revolver that I'm the primary owner of, if I pay it to $0 balance, will this hurt my scores? I'd be technically practicing AZEO since the Wells Fargo card will have the only balance. I'm trying to raise my Mortgage scores although I'm already preapproved for Conventional. Any advice is greatly appreciated.

Anonymous · ‎07-01-2021

@Anonymous wrote:
I have 3 CC Accounts that are open.

My first is an Open Sky Secured with a $200 limit since January. I've been paying it to a $2-6 dollar balance every month.

My 2nd is a Wells Fargo card that I'm an AU on. It has a $7000 limit and usually reports at 6% utilization.

My 3rd is another bank card that has a $10,400 balance that has a $0 balance every month. I am an AU on this one too.

My question is since the Open Sky is my only Revolver that I'm the primary owner of, if I pay it to $0 balance, will this hurt my scores? I'd be technically practicing AZEO since the Wells Fargo card will have the only balance. I'm trying to raise my Mortgage scores although I'm already preapproved for Conventional. Any advice is greatly appreciated.

AU cards have a seperate AZEO if they are factored in. If you pay your other card to $0 you will be hit with the all zero penalty for your personal cards. AU cards have their own all zero penalty.

HeavenOhio · ‎07-01-2021

AU cards can be unpredictable when it comes to how balances are scored. The best situation would be to continue with the $2–6 balance on the Open Sky card and for the AU cards to report zero.

Anonymous · ‎07-01-2021

For FICO 8 scores, letting your card report a zero balance will cause you to receive an all zero penalty, even if the AU is reporting a balance.

For mortgage scores, you only need 1 card to report and it can be either your own card or an AU card. It is hard to say how much of a benefit you will receive from this. If you have time you could test it and see if you gain any points, but if your mortgage is quickly approaching and your scores are already acceptable then I would leave things as is and continue to let the AU and your card report a small balance.

Anonymous · ‎07-01-2021

Thanks everyone. I haven't found a property yet because of the outrageous market we are in. But I am already approved. I will just continue to pay the Open Sky down to $2 to $5 dollars so I won't hit the all zero penalty. I would've considered getting another card or 2 but I don't want to open any new accounts until I close on a loan.

Anonymous · ‎07-02-2021

@Anonymous wrote:
Thanks everyone. I haven't found a property yet because of the outrageous market we are in. But I am already approved. I will just continue to pay the Open Sky down to $2 to $5 dollars so I won't hit the all zero penalty. I would've considered getting another card or 2 but I don't want to open any new accounts until I close on a loan.

That is a good call. Mortgage scores (and underwritng) do not like to see recently opened accounts. Best of luck finding a property!