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All Zero Penalty to AZEO

Valued Contributor

All Zero Penalty to AZEO

Many of you here already know the impact on scores when utilization reports 0% to CB’s. This thread shares my recent experience and the penalty for letting my CR’s reflect “zero usage.”

 

For awhile now I’ve been using the AZEO (all zero except one) method, meaning I let only one of my CC’s report a balance less than 28.9% of the card limit (individual) and less then 8.9% of my overall limit (aggregate) when statement cuts and have the rest of my accounts report zero. Whether or not you use the AZEO strategy, keep in mind those individual and aggregate utilization thresholds aforementioned as it may help improve your scores if below them.

 

I’ve noticed that this AZEO method works for me, but generally is not needed unless you are in the works of seeking new credit, a mortgage or loan.

 

Recently, my CR’s reflected 0% utilization due to the account being rotated with utilization was last to report among all my cards. Thus, dropping my scores for a short period of time until the account that reflected a balance finally reported.

 

Prior to this change, the card I was letting report reflected a 3% individual utilization and less than 1% aggregate making a 3% individual dip and minute aggregate decrease.

 

I was penalized by all 3 Bureau’s, EQ, TU, EX dropping my scores -20, -16, -14 respectively. When my account with a balance (a 3% individual utilization too) finally reported, my scores increased EQ (+23), TU (+16), EX (+16)

 

Note that points may differ depending on profile type. I have a clean, but thin profile with only a couple years of history.

 

Using AZEO does not mean you are only using one card per statement period. You can use as many cards you like as long as you pay them down to zero before statement cut, except for one. Hence why I put zero usage in quotation at the end of the first paragraph.

 

TLDR: As a result of letting util report 0%, my scores declined -20, -16, -14 for EQ, TU, EX respectively. Then scores inclined EQ (+23), TU (+16), EX (+16) when a 3% utilization (individual) and less than 1% aggregate. The exact utilization’s for which was reflected prior to the 0% report.




My Cards:






Profile Type: New, Thick, 100% Clean
INQ's: EQ: 0 TU: 1 EX: 3 (last 12 mo.)
Recent Accounts: 4 (last 24 mo.)
Total CL: 28.95k Util. 3% AAoA: 1yr, 8mo.
AoOA: 2 yrs, 8 mo. AoYA: 0 mo. 100% PIF.





myFICO Member since: July 21, 2018 | Joined Community: Aug. 17, 2018 | Starting Scores: EQ: 716 TU: 738 EX: 698
73 REPLIES 73
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Valued Contributor

Re: All Zero Penalty to AZEO

Nice post, @angelwingz!

 

Now I'm curious about the difference in before/after EQ/EX 8 scores - +3 and +2.

 

Specifically because the aging values between reports would have all been the same.

 

 

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

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Message 2 of 74
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Valued Contributor

Re: All Zero Penalty to AZEO

I'm not too sure. Everything on my CR's are the same. I found that interesting as well. Could it be possible that its because 2 of my accounts aged to 2yrs, 6mo?




My Cards:






Profile Type: New, Thick, 100% Clean
INQ's: EQ: 0 TU: 1 EX: 3 (last 12 mo.)
Recent Accounts: 4 (last 24 mo.)
Total CL: 28.95k Util. 3% AAoA: 1yr, 8mo.
AoOA: 2 yrs, 8 mo. AoYA: 0 mo. 100% PIF.





myFICO Member since: July 21, 2018 | Joined Community: Aug. 17, 2018 | Starting Scores: EQ: 716 TU: 738 EX: 698
Message 3 of 74
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Valued Contributor

Re: All Zero Penalty to AZEO


@angelwingz wrote:

I'm not too sure. Everything on my CR's are the same. I found that interesting as well. Could it be possible that its because 2 of my accounts aged to 2yrs, 6mo?


Did you see all those changes via your myFICO subscription alerts this month? (I have had FICO Premier for over a year now.)

 

The aging would have happened on 02/01, and be reflected in the first drops. I have seen a few TU alerts due to aging alone, but not with EQ/EX.

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

Keeper of the Scrolls of ResilienceEQ FICO Resilience Index Score Leaderboard

48 forum members have shared this new credit score. Share yours today!

Message 4 of 74
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Valued Contributor

Re: All Zero Penalty to AZEO

Yes, I have MyFico 3B subscription. 

And your right, I totally forgot ages count on the first day of a new month.




My Cards:






Profile Type: New, Thick, 100% Clean
INQ's: EQ: 0 TU: 1 EX: 3 (last 12 mo.)
Recent Accounts: 4 (last 24 mo.)
Total CL: 28.95k Util. 3% AAoA: 1yr, 8mo.
AoOA: 2 yrs, 8 mo. AoYA: 0 mo. 100% PIF.





myFICO Member since: July 21, 2018 | Joined Community: Aug. 17, 2018 | Starting Scores: EQ: 716 TU: 738 EX: 698
Message 5 of 74
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Super Contributor

Re: All Zero Penalty to AZEO

When you reached 2 years AAoA, did you notice any change on your credit report?

Message 6 of 74
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Valued Contributor

Re: All Zero Penalty to AZEO

Yes, I believe I did receive a point increase. Couldn't tell you exactly what that number off the top of my head, but I want to say 5 points or so.




My Cards:






Profile Type: New, Thick, 100% Clean
INQ's: EQ: 0 TU: 1 EX: 3 (last 12 mo.)
Recent Accounts: 4 (last 24 mo.)
Total CL: 28.95k Util. 3% AAoA: 1yr, 8mo.
AoOA: 2 yrs, 8 mo. AoYA: 0 mo. 100% PIF.





myFICO Member since: July 21, 2018 | Joined Community: Aug. 17, 2018 | Starting Scores: EQ: 716 TU: 738 EX: 698
Message 7 of 74
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Frequent Contributor

Re: All Zero Penalty to AZEO


@angelwingz wrote:

Many of you here already know the impact on scores when utilization reports 0% to CB’s. This thread shares my recent experience and the penalty for letting my CR’s reflect “zero usage.”

 

For awhile now I’ve been using the AZEO (all zero except one) method, meaning I let only one of my CC’s report a balance less than 28.9% of the card limit (individual) and less then 8.9% of my overall limit (aggregate) when statement cuts and have the rest of my accounts report zero. Whether or not you use the AZEO strategy, keep in mind those individual and aggregate utilization thresholds aforementioned as it may help improve your scores if below them.

 

I’ve noticed that this AZEO method works for me, but generally is not needed unless you are in the works of seeking new credit, a mortgage or loan.

 

Recently, my CR’s reflected 0% utilization due to the account being rotated with utilization was last to report among all my cards. Thus, dropping my scores for a short period of time until the account that reflected a balance finally reported.

 

Prior to this change, the card I was letting report reflected a 3% individual utilization and less than 1% aggregate making a 3% individual dip and minute aggregate decrease.

 

I was penalized by all 3 Bureau’s, EQ, TU, EX dropping my scores -20, -16, -14 respectively. When my account with a balance (a 3% individual utilization too) finally reported, my scores increased EQ (+23), TU (+16), EX (+16)

 

Note that points may differ depending on profile type. I have a clean, but thin profile with only a couple years of history.

 

Using AZEO does not mean you are only using one card per statement period. You can use as many cards you like as long as you pay them down to zero before statement cut, except for one. Hence why I put zero usage in quotation at the end of the first paragraph.

 

TLDR: As a result of letting util report 0%, my scores declined -20, -16, -14 for EQ, TU, EX respectively. Then scores inclined EQ (+23), TU (+16), EX (+16) when a 3% utilization (individual) and less than 1% aggregate. The exact utilization’s for which was reflected prior to the 0% report.


For me, fico9 took a 9 point drop I think it was, in the last navy update. Simply because of a 2 card reporting a bal. Normally, I see a reason code for my score, the length of time accounts have been established. That was replaced by, Too many accounts with balances. Anxiously awaiting here to see all accounts report next month. Ive paid the 2nd card off. Plus, decreased overall uti to under 2%. 

Message 8 of 74
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Super Contributor

Re: All Zero Penalty to AZEO


@CassieCard wrote:

Nice post, @angelwingz!


Agreed. It's a quality post. Those are significant points loss for going All Zero. AZEO is a definate score boost.

Message 9 of 74
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Super Contributor

Re: All Zero Penalty to AZEO


@angelwingz wrote:

Yes, I believe I did receive a point increase. Couldn't tell you exactly what that number off the top of my head, but I want to say 5 points or so.


I recall reading Thomas_Thumb mentioned AAoA is a scoring attribute. IIRC 24 months should be a AAoA threshold.

 

https://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/Question-about-AAoA-and-AUs/m-p/5565366/...

Message 10 of 74
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