Chapter 13 Discharge = Score Drop?

[TigerCat]

Well, after 4 very long years since my total credit meltdown, I have successfully completed my Chapter 13 BK plan and have received my discharge. So I was a little surprised when I received congratulations from MyFico: a 13 point drop in my EQ score down to 684.  I thought I would be rewarded and not punished. I guess not. Is this common? Does anyone have any thoughts on this?

Since filing, I never paid anything late. I had several open accounts that survived the BK which I think really helped my score. When my statements cut this time, I had used about 18% of available credit.

[Anonymous]

Hi TigerCat,

Congrats on completing your Ch 13!!!  Most people who file 13 aren't able to complete the program!

And congrats also on having open accounts which survived the BK.

FICO scoring re: bk isn't affected by discharge date - only by filing date.  (And even if you're discharged, it may not yet be reporting on your CR.  Look at status under your BK and see if it reports filed or discharged.)

So, let's look at something else that may be affecting your scores. 

First, I take it you're subscribing to Scorewatch for your updated EQ FICO?

My FICO doesn't go up, nor does DH's when he goes above 9% utilization to 18%, but that will vary with each individual.  So, your score may have dipped if your utilization went up.  If so, it may return to normal when your balances go back to where they were.

Did you have a different number of accounts reporting a balance?  If that number goes up, your FICO may go down.

Did anything age?  If so, you may have been rebucketed - which is good.  That usually means your potential score is in a higher range even if you take an initial hit.

Let us know a little more about what's on your report, and you'll get some good feedback about what may be affecting your score.

And congrats again!!!

[TigerCat]

Thanks beamMEup. It was a long hard road, but I made it. I was fortunate to have a great attorney too. I can't say enough good things about him.

Anyway, my filing date was March '06. The discharge is now reporting on both EQ and EX. I haven't pulled TU yet though.

Yes I have a Scorewatch subscription to EQ. 

I only had one account reporting a balance this past month.

One of my accounts renewed this month, and my CL was increased by 40%.

Thanks again for the insight. I hope this information makes the picture a little clearer.

[Anonymous]

Did your scorewatch indicate that your score changed on a day when there weren't any alerts?  Or was there an alert associated with it?  (Not that it's a perfect system by any means).

I did just double check my EQ credit reports and my scorewatches - I received no score drops when my CH 13 was discharged.  None.  For sure.  Just for your peace of mind. 

I'm not sure what may have triggered your score drop.  When you say one of your accounts renewed, that makes me wonder if your AAofA changed.  I'm a little geeky, but I would figure out what your current AAofA is - if it just popped above a threshold it might have made the difference.  Other posters have indicated some significant score changes with AAofA changes.