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Cannot understand why my Fico score has dropped 100 points in a year

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Cannot understand why my Fico score has dropped 100 points in a year

I am retired, paid off my house,have no loans,don't owe anyone any money , pay my balances on all my credit cards the day I get them, all bills paid automatically only have 1 missed payment in over 40 years and my FICO Score has gone from 840 to 719 in one year..I have checked all my credit reports and they all show excellent payment, low use( over 60,000 worth of credit available and only using 2000-3000 per month)carrying no balances..I have no installment loans and they say that it shows no installment loan activity...I have no idea what I can do to get this fixed...I have been able to get 2 new credit cards within the last 2 months and cancelled one.....Can anyone help direct me as to how to get this fixed?

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3 REPLIES
Super Contributor

Re: Cannot understand why my Fico score has dropped 100 points in a year

Add an installment loan.  Do a search for share secure technique on here and you'll find all the info you need.  That will score you around 30 points.  You said you have one late payment in the last 40 years.  When was it?  If it was in the last 7 years, it's likely impacting your score.  If it was in the last 2 years or even more recent, it's probably hurting your score a lot.  Late payments don't care if you have had 40 years of great payment history or 2 years... if you are late it's going to damage your credit just as bad.  You already said your utilization is low, so that doesn't look like a problem to me.  If you've got 40 years of credit history, I'd venture to guess that your AAoA is pretty solid, as is your AoOA.  How about inquiries/new accounts?  Any of those in the last year or so?

Message 2 of 4
Super Contributor

Re: Cannot understand why my Fico score has dropped 100 points in a year


Rck60s wrote:

I am retired, paid off my house,have no loans,don't owe anyone any money , pay my balances on all my credit cards the day I get them, all bills paid automatically only have 1 missed payment in over 40 years and my FICO Score has gone from 840 to 719 in one year..I have checked all my credit reports and they all show excellent payment, low use( over 60,000 worth of credit available and only using 2000-3000 per month)carrying no balances..I have no installment loans and they say that it shows no installment loan activity...I have no idea what I can do to get this fixed...I have been able to get 2 new credit cards within the last 2 months and cancelled one.....Can anyone help direct me as to how to get this fixed?


Sounds to me like you're doing just fine but if you want to optimize your FICO scores you could add points by doing 2 things:

 

1. Let all but one of your credit cards report a zero balance, and have one card report a small balance (less than 10%).

 

2. Join Alliant Credit Union, open a $500+ savings account, take out a share secured loan for $500 secured by the savings account with 48 or 60 month term, cancel or waive autopay, then transfer enough from the savings account to the loan to bring the loan balance down to 9% or $45.

 

 


FICO8 EQ 735 TU 762 EX 732 Total revolving limits 593400 (493400 reporting)
Message 3 of 4
Valued Contributor

Re: Cannot understand why my Fico score has dropped 100 points in a year

From what I understand, scores will drop for:

- no open loans

- new accounts

- new HP

- old closed accounts drop from your reports

- some other factor to lower AAoA

- recent late payments

 

Goging down from 840 to 719 is not only for not having open loans.

 

If you want to know why the big drop, you need to list any changes on your reports from high score to lower score.

 

Do not apply for more cards. Follow SouthJamaica advice.

To report $0 balance you must pay your cards before closing date, so when they cut at $0 that's what they report. Good luck.

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