AZEO question

[Anonymous]

Hello, my wife and I are buying a house in her name only.  She had a mid score of 674 but we finished paying off a car and the score has dropped below the required 660, I beleive mid score is now 650.  I believe credit balances have all been 0 so we may have a chance at raising with AZEO.  She has one store card with $400 limit and is an authorized user on my Discover with $9,700 limit.  Which card should we put the balance and how much?  Some info I read is conflicting, we hear $5-10 but also 5-10%, also I am wondering if the balance on authorized user card vs store card makes a difference.  Thanks in advance!

[Anonymous]

From what I've read and practiced, you need 2 cards reporting zero and one card that reports a small amount (it doesn't matter apparently, but why not keep it below the Fico threshold of 8.9%) which you pay off as soon as it reports or before due date. And one installment loan. Other than great payment history, age of accounts, and no baddies, that's the magic formula. 

you do raise an important question: how does AZEO work with an AU setup? Is it both that practice it, or just one of you?

[Anonymous]

AU cards are in their own category as far as AZEO is concerned. If you have one AU card and it reports at zero, you will get an all-zero penalty for all AU cards being zero even if another of your cards is reporting a small balance. So basically you need one of your regular cards to report a small balance, and one AU card to report a small balance. For AZEO purposes they are considered as 2 separate categories. I found this out personally on my own reports and it was confirmed by others on this site. 

As for amount, under 4% is best. 

[Anonymous]

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@Anonymous wrote:

From what I've read and practiced, you need 2 cards reporting zero and one card that reports a small amount (it doesn't matter apparently, but why not keep it below the Fico threshold of 8.9%) which you pay off as soon as it reports or before due date. And one installment loan. Other than great payment history, age of accounts, and no baddies, that's the magic formula. 

you do raise an important question: how does AZEO work with an AU setup? Is it both that practice it, or just one of you?

Thanks guys, to clarify, I dont carry the small balance past the due date?  So... pay in full every month before due date or pay minimum allowing the small balance to remain on the card?

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[TheKid2]

Couple of things at play here - my understanding is that if you are specifically targetting Mortgage scores, the older algos do not have any AU penalties. So, in theory, AU will matter to FICO 8, but not Mortgage scores. Secondly, you really want the 1 balance to be on a BANK card, not a store or charge card. That balance could literally be $20 or even less - just be sure it it less than 8.9%.

Hope that helps.

[Anonymous]

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@Anonymous wrote:

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@Anonymous wrote:

From what I've read and practiced, you need 2 cards reporting zero and one card that reports a small amount (it doesn't matter apparently, but why not keep it below the Fico threshold of 8.9%) which you pay off as soon as it reports or before due date. And one installment loan. Other than great payment history, age of accounts, and no baddies, that's the magic formula. 

you do raise an important question: how does AZEO work with an AU setup? Is it both that practice it, or just one of you?

Thanks guys, to clarify, I dont carry the small balance past the due date?  So... pay in full every month before due date or pay minimum allowing the small balance to remain on the card?

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Just find out what day the card reports the balance to the credit agencies, and make sure that on that day, the small balance is there. You certainly do NOT have to let it carry past the due date. Let it report and then pay it in full so that you aren't charged any interest.

[Anonymous]

Great, thanks for all the replies.