Closed Charge-Off Account and Credit Utilization

[medicgrrl]

Paying the First Premier and letting one of your revolving accounts report a small balance of less than 9% should give you the score boost you need.

[DollyLama]

+1 FICO does not like zero utilization, that will plummet your score. FICO likes extremely low utilization, and everyone here with testing, data and graphs have reported a significant score bump by the AZEO (all zero except one), so only charge a small amount on one of your CCs, a tank of gas, anything that will be less than 8.9% of that one card's credit limit, so if the limit is $300, do not charge more than say $25. 

[SunriseEarth]

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@Anonymous wrote:

I have an old First Premier credit card that is charged off and closed. The balance is not being factored into my Experian credit utilization therefore that is my highest score. The balance is however being factored into my utilization for TU and EQ, making those score quite lower. Can someone explain to me how I get the balance factored out of my utilization on TU and EQ? Perhaps Experian should be factoring it in and they are not? (which I'm not going to complain about!). Paying these accounts is not an option as they will be falling of next yr and I do not want to reage them. I was recently pre-approved for a mortgage loan but they came back saying all "dispute" remarks needed to be removed. I had them removed but now my mid score 579....literallly 1 point under the limit which is 580. I'm trying to find a way to increase my score just a little so we can move foward with my loan. I figured if I could get the charge off balance factored out of my TU and EQ score that would surely do it! They were not being factored into my utilization prior to me disputing those accounts. Another option I have is to make a large payment on my student loan. Using the simulator, I can see this will increase my FICO 8 Score but will it increase my Mortgage Fico score? I wish the simulators worked for all scoring models! Please help me!

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As others have said, paying/settling the accounts will not reage your debt.   That is based on DOFD, not DOLA.  If you are past SOL for your state, you may want to see if FP is willing to settle.   I'm not sure if they do PFDs, but even "settled in full" and a $0 balance will boost your scores.   I highly recomment checking the "Rebuilding" forum for more information on how to deal with FP.

[Anonymous]

Thank you EVERYONE for all your help! Today we found out the seller agreed to an extension so we now have until July 31st to close! This is good news because it give me time to get my score up. I called First Premier Bank and they stated I could settle both CO accounts for a total of $500. I asked when they would report the zero balance to the CRA's and they said by the July 14th and that they werent' sure how quickly it would be updated after that. They lady I spoke with said if I pay with a debit card, they could fax me a letter stating the accounts are settled and now have a zero dollar balance. She suggested that I send those proof of payment letters to the CRA's and that it might get the accounts updated faster. Does anyone have experience with this? In my eyes, unless they are going to call the creditors to confirm the accounts are paid, it's pointless, because mail takes way too long. I cannot wait 30 days for a dispute. Any suggestions here?? Does anyone know if they call the creditors or mail the creditors?

[Anonymous]

While you are working on the problem of paying the balances on the closed cards to $0, be sure that you are working on getting one open card to report a small positive balance.

[Anonymous]

Ask your lender to do a "rapid re-score" once you have them paid off and fixed...it's a common thing they can do, they had me pay off 5 accounts when I bought my house a couple of years ago and all I had to do was provide them with a screen shot showing zero bal and 48hrs later they did the rapid re-score and I was golden (I was going for a better rate of 4%)

[Anonymous]

Funny that you mention that! I just read about rapid rescoring earlier and thought, that's what I need! My LO is going to ask tomorrow, but he believes they do offer it. I read that it's only recommended for people having accounts removed or changing the status of an account but I don't see how it wouldn't help me. My utilization is currently at 29% and paying these off will bring it to 0%. I know it's not recommended to be at 0% but it has to be better than 29%. The simulator on here shows it will raise my score 20-30 points. Do you think the simulator is reliable? I honestly only need about 6-10 points so if it's not totallly accurate, that's fine, as long as I gain the points I need.

[Anonymous]

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@Anonymous wrote:

 I know it's not recommended to be at 0% but it has to be better than 29%. The simulator on here shows it will raise my score 20-30 points.

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You have been repeatedly advised in this thread (by multiple people) of the harm that occurs when all cards report $0 and the much better scoring advantage you have when exactly one of your open cards reports a small positive balance.

It sounds like you are resisting that and plan to have all cards at $0.  Can you help us understand why?

PS.  Just for clarity, no one is discouraging you from paying off the closed cards.  Everyone thinks that is great.  It's your desire to have all cards at $0 that is the puzzle.

[Anonymous]

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@Anonymous wrote:

You have been repeatedly advised in this thread (by multiple people) of the harm that occurs when all cards report $0 and the much better scoring advantage you have when exactly one of your open cards reports a small positive balance.

It sounds like you are resisting that and plan to have all cards at $0.  Can you help us understand why?

PS.  Just for clarity, no one is discouraging you from paying off the closed cards.  Everyone thinks that is great.  It's your desire to have all cards at $0 that is the puzzle.

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I'm not refusing, I just don't know how I can do that when all my cards already have a $0 balance and I'm shooting for a rapid re-score tomorrow. The 2 charged-off/closed First Premier accounts are the only CC accounts with balances. I did buy gas today on one of my open CC because of what ya'll have suggested but it will probably be a few weeks until that balance is reported to the CRA's and I'm wanting to boost my score ASAP. If rapid rescoring is NOT something my lender offers than I will have to wait until my credit reports are updated and at that point, I'm sure my open CC will show the small balance. How can I get my open CC to report the small positive balance within the next few days?

[rmduhon]

What cards do you have? Some will do off cycle updates if you ask them.