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Credit Scoring Primer, pub.5.17.20

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Credit Scoring Primer, pub.5.17.20


Intro- (Table of Contents in Post 8 - find subject matter/understand flow. )

Useful links in Posts 8 and 10.




Quick Reference


**Cassie's Neg Reason Code/Score Factor Thread.**


**ccquest's Workbook calculates utilization, balances, ages & more **


FICO Score 8 select optimal Characteristic Attributes




Payment History

100%, Zero baddies. Penalty fully removed after 7 years, with few exceptions. 60D late or worse is a dirty scorecard.

Aggregate Revolving and Installment Utilization


Number/Percentage of Accounts with a Bal

Recommend 20% of accounts or less, IMHO. Metric is weighted less in Score 8 and varies by bureau/scorecard. EX8 less sensitive. (15% for 5-4-2)

Revolving Bal

Under $100; Never $0 or AZ (All Zero) loss; All AUs at AZ is a separate and independent AZ loss on 8 & 9.

AoOA-Oldest Account

Not a scoring factor. Segmentation factor for clean profiles, 3 years for 8/9, 2 years for 5/4/3/2.


Age of Oldest Revolving Account

Scoring factor mistaken for AoOA, but if oldest account is a revolver, AoORA=AoOA

AAoA- Avg Age of Accounts

Max award believed to be at 90 months


Avg Age of Revolving Accounts

Scoring factor; similar to AAoA, but revolving activity is always weighted more heavily.


Age of Youngest Account

Scoring factor on 8/9; at times awards points.


Age of Youngest Revolver/Open-ended

Segmentation factor for clean profiles on 8/9 at 12 months.

Inquiries in Last 12 Months

Zero. Score penalty removed at 365 days.

Total Number of Accounts/Mix

Not a scoring factor. Segmentation factor for clean profiles. 4 TLs for Thick?, include 1 loan for diversity points. (Penalty for too few/many accts.) Revolver:Loan Ratio 3:1 or 4:1?


Where did this come from?


MWGardener19 inspired this thread and composed the 1st part of post 1 which is a background/overview (with corrections, alterations, and edits by MF Contributor Birdman7, who has not fact checked and cannot guarantee  MWGardener19's portion). The mechanics start in the 2nd part of this first post with Scorecard Basics by Birdman7. While no one knows the exact workings outside of FICO, this Primer has the best information available, IMHO.


Birdman7 began by cleaning up a small Reddit post from rtanaka6, brought by MWGardener19, who had made it from years of reading MF forums. Well, Birdman7 couldn't let the inaccuracies stand and so much was missing, so he went crazy & here's where it ended up, a new creation, but the Reddit post was the starting point, so we acknowledge that.


No doubt many will have additions, corrections and criticism. Nevertheless, this is a primer and a reference, and I hope to update it as we learn more.


Begin MWGardener19:


Brief background


Fair Issac and Company - FICO - states Score 8 is the most widely used credit scoring system. Score 8 is one of many models FICO created and lenders use to evaluate credit risk (Score 2, 3, 4, 8, 9; Bankcard 2, 3, 4, 5, 8, 9; Auto Score 2, 4, 5, 8, 9). There are more scores, and we know that at least 2 new scores are expected to be in use in 2021 (Score 10 and Score 10T).


FICO began creating their systems over 60 years ago (1956). The FICO scoring system as we know it today is only about 30 years old (1989). FICO is a large, global, publicly owned company with over 4000 employees. 88% of the $1billion in revenue FICO generates comes from banking/insurance customers. 35% of that revenue is from international customers. Scores purchased by consumers are a small part of their business.


FICO scoring and these forums


As users of this forum have or will come to learn, there are certain observations that can be said about FICO scoring:


- we have come to know GENERALLY how FICO scoring works,

- we have come to know A LOT about how certain aspects of scoring works, BUT

- we have come to know that we do not know EXACTLY how all of FICO scoring works.


FICO's approach to performing credit scoring is proprietary, meaning that it is private. The folks at FICO knows how their scoring systems work. The rest of us take increasingly educated guesses at learning the finer points of those scoring models, and we come to forums like this to learn for ourselves how to understand, improve and manage our scores, and to help others to learn as well.


As of April of 2020, these forums have nearly 300,000 users and over 4 million posts. These forums provide great value.  As users have also likely observed, many of the same questions are asked and answered again, and again.


The purpose of this thread is to try to capture what we know, what we think, and what we are still trying to learn more about.  Because there are more than 28 different FICO models that exist, the guidance and answers that apply to one scoring model may be different for another model. Rather than trying to cover all of the FICO scores in one thread, we will focus on Score 8, but also examine 5/4/2 and 9 to a lesser degree in their own sections.


These forums have MANY VERY smart members with extraordinary depth.  It is my hope and intention that we try to capture our knowledge in one thread to make it easier for forum members - new and old - to have a single stop to get the most complete understanding of what we know. Score 8 was released in 2009, but we are still learning more about it today.


At a high level, Score 8, as with other FICO scores, is used by lenders to understand credit risk which measures how likely or unlikely it is for a prospective debtor to default on a credit obligation by 90 days in the following 24 months. FICO scores draw data from EQ, TU and EX to generate a score. The algorithms are unique at each bureau, as they're generated from the CRAs respective unique datasets from particular time periods. They are then subject to varying levels of customization per CRA request (TT). Therefore, the same version's scores may vary across CRAs, since each CRA's algo is unique.


FICO scores evaluate credit report data, and use very complex mathematics to calculate and report a credit risk score. (How complex, you ask? The underlying math considers Lorenz curves, Gini coefficients, normalized log Bernoulli Likelihood, multicollinearity testing, and other higher mathematics.) [ I believe a lot of the math mentioned is used to analyze datasets to create the scorecards (algorithms), not to generate scores. Fact check? BM7]


FICO Score 8 key differences


Score 8 was designed to be more sensitive to high revolving utilization than earlier versions. It excludes nuisance collections (under $100), and is more forgiving of isolated delinquencies compared to earlier versions, but all other accounts must be in good standing. Whereas earlier scoring versions were more customized for each specific bureau, an objective of Score 8 was to reduce disparity among the scores at the 3 bureaus. (Version 9 is supposed to have even less disparity, excluses nuisance collections and paid collections.) You can still have a score difference of +\- 30 points on 8 among bureaus with identical data, per the esteemed Moderator Emeritus Revelate.


 So, how does scoring work in FICO Score 8?


Again, we do not know with precision. There are a number of things we've learned. Thanks to Reddit u/rtanaka6, who captured many of Score 8's highlights from years reading this forum. It was the genesis, but this is really a new creation. Also, note: this thread is dynamic and will be updated with data from posters who provide their expertise so we can recognize and thank them for helping us learn more.


 As with other FICO models, there are 5 categories or "ingredients" which are evaluated. Your credit report data is fed into the FICO "blackbox" at the respective CRA (Credit Reporting Agency) and is ran through the appropriate scorecard (algorithm). The scorecard evaluates your data based on these 5 categories and generates a score and negative reason codes, which are listed in order of precedence and can offer insight into your score from any version. FICO Score 8 ratings and scores are:



Score Range

Exceptional (or excellent)

800 - 850

Very good

740 - 799


670 - 739


580 - 669


300 - 579


The categories/ingredients that are evaluated from your credit report, and their weightings are:



Payment History



Amount of Debt



Length of History



New Credit



Credit Mix


Remember credit scores are connected with approvals, but are often not the only factor. Inquiries (more here) are used to: 1) generate a score and negative reason codes, 2) analyze your credit data, and 3) give notice to other lenders you have sought credit. This information is used to determine approvals, interest rates, terms, and starting credit lines. Credit scores matter, but are not the sole reason or consideration. Lenders will also ask for data not contained in CR data to consider as well, such as income and housing expenses. Please note income is not reported to the bureaus and is not a part of scoring. Lenders consider that separately.


MWGardener19's edited work ends here/

Begin Birdman7's labor:

Scorecard Basics


There are various metrics within each category. FICO calls each metric a "characteristic" and the cooresponding value is called an "attribute." To be more granular, we break characteristics into 2 categories: "segmentation factors." and "scoring factors." Segmentation factors determine scorecard. Scoring factors directly affect score and their signal strength (weighting) varies by scorecard.  Scorecards are algorithms by their simplest definition. The scorecards generate a score and negative reason codes from the CR data it's fed based on the scoring factors as weighted per the scorecard.


Score 8 has 12 scorecards: 8 clean and 4 dirty scorecards. Which scorecard you are assigned to depends on the segmentation factors. For clean profiles these segmentation factors include thick/thin (number of accounts); mature/young (age of oldest account); and no new revolver/new revolver (recency of new revolvers). For dirty profiles, I believe segmentation factors are PR (severity) and recency.


Scorecard assignment is a complex matter to be covered in another post on this thread, maybe another thread; there are many posts scattered throughout these forums that we will try to consolidate here. What is important to know about scorecards is that they impact how your specific score responds to information in your credit report and they are why your profile reacts differently than someone else's for the same event. The scorecard to which you are assigned determines your minimum and maximum scores, which negative reason codes are applicable to you, and the signal strength (weighting) for the various different scoring metrics described below.


Each scorecard is geared to specific credit profiles. Scorecard reassignment (rebucketing) occurs when you change scorecards. This can result in a score boost or drop depending on the situation. For instance, when you go to a higher scorecard, you are basically moving from the top of one ladder to the bottom of another and would now be compared to a sub-population with better credit profiles. Therefore, often you will see a score drop. The reverse also holds true, but be aware there are many exceptions and scorecard theory is complex. For example, most experience a significant drop at 3 years AoOA, when reassigned to a mature scorecard on 8/9.

What follows is an example of how different scoring factors have differing signal strengths depending on scorecard:




A scorecard example for Payment History, Amounts Owed, Length of History, New Credit, and Mix follow (Keep in mind awards vary by profile and there are far more than 1 scoring factor per category):




Again, there are 12 cards in Score 8. (Rumors of 14 are false, 2 were pulled over AU issues.) There are 8 clean and 4 dirty scorecards. Clean/Dirty is the first segmentation factor and determines the subsequent segmentation factor path. A clean profile is then segmented by: Thick/Thin, Mature/Young and then No New Revolver/New Revolver. We will go over these in more detail as we progress through the categories.


If instead a profile is dirty (60 day late or worse), we are not as clear. I believe the profile is then segmented into a PR (public record) card or a delinquency card, which is severity. Then further segmented by recency into a recent or mature card

PR cards include profiles with collections, bankruptcy, or other public records, such as tax liens (delinquencies are subsumed). A judgment would also put one there, but they are typically no longer reported due to the NCAP (2015), implemented 2017. 


The below is my approximation of how the scorecards in FICO 8 are segmented:




For delinquencies (not collections) recency appears to go from the date of last update, if unpaid. If paid, recency appears to go from the date paid in full or settled. Therefore, once paid or settled, delinquency recency appears to be frozen.


So one could express their scorecard as clean/thick/mature/no new revolver or dirty/PR/recent. Scorecard theory could have its own thread and there are many threads you can search to learn more. You don't need to be an expert, just know this is part of why different profiles react differently to similar actions and that certain penalties exist in some cards that do not in others. For instance, there is no "new revolver" penalty in dirty cards, whereas it's a 10-20 point penalty in clean cards. (We have recently learned that younger mature profiles have less of a penalty.) So, one good reason to get cards while dirty. Utilization is also more important in clean cards, for example. Below is a slide from FICO describing Score 8 segmentation very generally:






(Version 9 added a 13th scorecard for those with high revolving utilization. The specifics of how it works or what segments you into it are not yet known, just that it is for those with high revolving utilization.) (The '98 and '04 versions had 8 clean and only 2 dirty; the dirty were not segmented by recency and apparently all delinquencies are not banished to a dirty card for 7 years there either.)


We will now examine each Category and its segmentation and scoring factors in detail, sequentially, in sections 1-5, below. I will use the terminology of segmentation factors and scoring factors, as it's more granular than the generic term characteristic, which doesn't indicate whether it's for segmentation or scoring.




Last edited: 7.19.21 2:25am.

© 2021, Birdman7. All rights reserved.

508 REPLIES 508
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Re: Credit Scoring Primer - Payment History, Pub.5.17.20


35% - ~192.5 points



Per MF, 7 components make up Payment History :


  • Payment information on credit cards, retail accounts, installment loans, mortgages and other types of accounts
  • How overdue delinquent payments are today or may have become in the past
  • Amount of money still owed on delinquent accounts or collection items
  • Number of past due items on credit report
    Adverse public records (e.g., bankruptcies)
  • Amount of time that's passed since delinquencies, adverse public records or collection items were introduced
  • Number of accounts being paid as agreedLink. 

A. Derogatory Categories


This is the most important category, and absolutely 0 derogatories is necessary for maximum scoring in this category. The algorithm looks for delinquencies, (30, 60, 90, 120...CO (Chargeoff), CAs (Collections), BK, CFAs (consumer finance accounts), tax liens, or in Version 9, LM (loan modification, code AC)  Link.  etc.. Ideal is none. For one isolated 30 day late, you will wear a significant penalty.


A 60 day late is considered a major derogatory and will segment you into a dirty scorecard for 7 years on Score 8. (It appears a 60 day late only assigns you to a dirty card for 2 years on TU4 per recent testing by our esteemed Moderator Emeritus Revelate Link.  Appears to be confirmed for EX2 as well, by MyFICO Contributor Ficoproblems247 Posts 10 and 17.  Evidence EQ5 segments delinquencies at 2 years. Link. Note: the "new account" negative reason code only appears on clean cards in the Classic scores.)


Creditors typically report a debtor 30, 60, 90, 120 days late and then the account may be charged off (CO). (CO is typical @ 120 days for loans and at 180 days for CCs. [See link in Post 7.])  A CO  does not mean the debt is no longer owed/collectable, just that it isn’t expected to be collected and has been removed from the asset column of the creditor's balance sheet. At this point, the account is closed if it hasn’t already been. If the account still has a balance and is owned by the OC (Original Creditor), the TL (Tradeline) will reflect the outstanding balance.


Please note a CO is an accounting measure and may not have a direct effect on your score. The score loss appears to be tied to the TPOD (total period of delinquency) Link, which is from the DOFD (date of first delinquency) until the last update, if unpaid or from DOFD until paid, if paid. That's why when a CO is regularly updated, score continues to be suppressed, but if not regularly updated, it does not. Also why if you pay it way later when it hasn't been updating, you can see a drop.


If you have paid the balance on a chargeoff or subsequently do so, the TL should be updated to reflect the $0 balance and to change the Current Status from CO to paid or to paid, settled for less. If the debt is sold, the balance should also be updated to $0. These situations will affect utilization, see Section B, Amount of Debt and can also affect aging (TPOD) see Section C. 1., Aging, below.


B. Collections/CA (Collection Authority)/Dunning Notice/DV (Debt Validation)


If you fail to pay a debt after CO, it could be assigned or sold to a CA (Collections Authority). This is a separate and additional TL to the OC’s, and causes additional penalty and scorecard reassignment to a PR card, if you had no other PRs. (Note: all OC’s don’t report a OC TL, such as cable/phone, but a CA can still appear and penalize.)


Upon first contact, CA is required to notify you in writing within 5 days of your DV (debt validation) rights. (called a Dunning Notice.) You have 30 days to request DV. It should be sent CMRRR (certified mail return receipt requested). Until the CA responds, CA is prohibited from attempting to contact you (except filing judicial process, etc...). If the CA fails to timely respond or cannot validate the debt, it may delete the collection. If not, you may seek removal via dispute with the CRAs. Just keep in mind they can always come back if they're valid. Just because they delete them doesn't mean they can't validate. If you let the 30 days pass without submitting a DV, you still may send one, but the CA is not required to respond and is not barred from contact..


If the debt is sold to a CA, the OC TL balance should be updated to $0; if assigned, the balance should remain on the OC TL, as well as be listed in the separate and additional CA TL. But, be aware that if an OC’s TL is assigned to a CA, the CA is required to delete the collection TL IF the debt is recalled  by the OC. So, the preferred method of dealing with a collection is to attempt to negotiate with OC and have the OC recall it. This will require deletion of the collection, even though the OC’s CO TL may remain and be updated. To address the remaining the CO, see GST (Goodwill Saturation Technique).


However, if the OC TL is sold to a CA, then you must negotiate with the CA and the preferred course of action is to request a PFD (Pay for Delete) from the CA, which is where you negotiate with the hope of paying in return for deletion. Be aware this is against CRA policy and CAs may refuse; however, some will accommodate under various interpretations. It is common for a CA to be reluctant to put it in writing for obvious reasons. It's noteworthy that oral contracts are enforceable; they're just hard to prove if denied. Laws on recording phone calls vary by state, some require the other party be notified, some only require one party to be aware. Consult counsel/law in your jurisdiction. Link.  


For collections (CAs), "[a]s far as your FICO Score is concerned, two things are considered:

  • has a collections appeared on your credit report
  • when it was reported" Link. 

So, whether or not it's paid is not even a consideration, scorewise til 9! But it looks better to prospective lenders if paid, even if late. See Aging below.


C. Derogatory Aging


  i. Scoring


It is believed delinquency penalty is reduced at 6, 12, & 18 months for 30, 60, 90 and 120 day lates, but all baddies will affect score for 7 years. Recency and frequency of baddies plays a critical role. The change at 2 years appears to be scorecard reassignment, which may also apply to chargeoffs. 


Link to derogatory aging graph. (Credit: MyFICO Contributor ABCD2199.)


COs can be tricky. They are not like lates subsequently brought current, where the TPOD remains constant at 30, 60, 90, or 120. With a CO, TPOD continues to grow and suppress scores until it's paid, if regularly updated. If instead an OC fails to regularly update the OC TL, the algorithm doesn't know the delinquency period has grown, so TPOD is frozen and no further score suppression occurs; however, if the TL is updated at some later time, the algorithm realizes TPOD has increased and you may be penalized appropriately to catch up, (TPOD catchup penalty) Link. Link. Link. (Credit: the esteemed MyFICO Legendary Contributor RobertEG.) This typically occurs when someone pays an old late, only to be surprised by a score ding. Could also occur when updated by a sale to a CA, when paying a CA where the debt was assigned, or from a dispute updating the delinquency, if the TL was not regularly updating. However, this drop can be offset or outweighed by changes in utilization or other changes.


There are 3 separate fields in particular that are relevant, Payment Status, Current Status Link and Date Updated. (Credit: Our esteemed MyFICO Legendary Contributor RobertEG.) Payment Status shows the highest level of delinquency that has ever occurred on the account (30-CO), Current Status shows the current status, whether CO, paid, or paid, settled for less, and Date Updated is obvious.


When a CO is regularly updated (Date Updated Field), it continues to suppress scores because the TPOD is increasing, similar to going from a 30 to 60. Because the Current Status field remains CO, the algorithm knows it's still delinquent through the last update and calculates increasing TPOD (Date Updated Field - DOFD) and penalizes appropriately. Thresholds, if applicable, are not known. If the Date Updated field is not updated, the algorithm cannot determine TPOD has increased and therefore can't further suppress/penalize scores. (Be happy when they aren't updating, but know you may eventually pay the piper.)


When an update does occur, the OC updates the Date Updated field and TPOD is increased, if Current Status is still CO. Updates typically occur due to updating the Current Status field to paid or paid settled for less, or from a dispute, as stated above. Once paid, subsequent disputes should not cause dings because Current Status is paid and TPOD is therefore frozen. (Once a CO is paid, one can try the GST in hopes of having the OC remove the lates/account. Can't hurt, but might take 100 tries! Persistence.)


CAs are different and do not appear to help score if you pay them, only if they are deleted or age to some unknown threshold (PR scorecard recent > mature 2 yr?). "Your score weighs collections on your credit report according to when the collection occurred. Generally, the more recent the collection, the more it's going to hurt your FICO Score." Link. So over time a collection appears to reduce its penalty. Recency is determined from when it "occurred."


I believe "occurred" means opened, not updated. (Some think if regularly updated, it can't age to a mature PR card to lessen the penalty, but an MF blog says paying a CA in ver. 8 and older lacks positive scoring impact, so color me skeptical.)


Tax Liens and BKs should also reduce penalty over time when you shift out of the recent PR scorecard into the mature PR scorecard (believed to switch scorecards at 5 years on the mortgage scores). Judgments are no longer reported, but that could always change.


  ii. Removal


Regarding removal, the (FCRA) Fair Credit Reporting Act, §605(a) applies (15 USC § 1681c). Link.(page 28 by page, 22 by pdf.)


For open accounts, scattered lates are treated differently than strings of lates. With scattered lates, they are each removed at 7 years individually. With strings, it depends on bureau. "...Experian...excludes...delinquencies in a common “string” 7 years from [DOFD]...[t]he other two CRAs have no official, published policy interpretation, and have...excluded based on [DOFD] OR have treated each...delinquency as its own separate adverse item of information, and thus have not excluded...until each has reached...7 years..." [1] Link. Link 2.  The particular subsection for monthlies is a catch-all provision and lacks specificity. §605(a)(5), FCRA. Please note US Gov't insured/guaranteed student loans or national direct student loans have specially lengthened reporting periods. See sections 430A(f) and 463(c)(3) of the Higher Education Act of 1965, 20 U.S.C. 1080a(f) and 20 U.S.C. 1087cc(c)(3), respectively.


CRAs are prohibited from making CRs with accounts placed for collections or charged to profit and loss which antedate the report by more than 7 years. See §605(a)(4) & (c)(1), FCRA. At EX, The lates will age off, but the account may remain for 10 years, but from update or closure? See: link. 


Paid tax liens are removed at 7 years from payment. §605(a)(3), FCRA. Bankruptcy is removed 10 years from date of entry of the order for relief or the date of adjudication. §605(a)(1), FCRA.

Early exclusion: link. 

  iii. CR Removal Quick Reference


So, §605(a)(1): BK - 10 years from order/adjudication

                     (3): Paid Tax Liens - 7 years from payment

                     (4): COs and CAs - 7.5 years from DOFD/7 years from CO/Collection; 5 yrs NY Link. 

                     (5): Catch-all for any/all other negative information - 7 years (starting date ambiguous).


  iv. Judicial SOL (Statute of Limitations, varies by state)


Note: Whether a debt is judicially actionable is based on the state's SOL (Statute of Limitations) in the jurisdictions where the creditor could sue the debtor (Plaintiff has choice of forum with limited exceptions). This could be: 1. state the creditor is incorporated/organized in, 2. state you entered into the agreement in, 3. your home state, or, 4. if you have moved, your new home state. (Consult qualified counsel, Conflict of Laws and Jurisdictional Law are complex and beyond the scope of this thread and forum.) This 'Right of Action' SOL is separate and distinct from the federal exclusion SOL that determines how long negative data may be reported by the CRAs, which is the above time periods per the FCRA. 



D. Amount Still Owed on Delinquent Accounts


Per MF, the amount still owed on delinquent accounts is factored into the Payment History category. So once an account is charged off, the amount may be considered under the Payment History category rather than the Amounts Owed category. However maybe not. Same article says amount owed on collections are considered and we know that paying a CA without deletion offers no points. The only way I can reconcile this is if the initial penalty is determined in part from the CA amount.


At two years sleeping, COs may be taken out of revolving utilization and only accounted for by the Payment History category. Link. 


E. Multiple Delinquency Penalty


TU8 and EX8 are more forgiving of an isolated late. With frequency, an additional penalty. However, 800s are possible with a 60 day late.


F. Recency


Score 8 seems to penalizes more for recent delinquencies/derogatories. Probably due to the 2 new dirty scorecards I believe segment based on recency. (5-4-2 appears to reassign to clean cards with penalties @ 2 years for some lates.)


EQ8 42 month threshold on missed payment, link. 


G. Number of Accounts Paid as Agreed


The category needs a certain amount of current payment history to score most accurately. A variety of at least 7 positive accounts, actively reporting paid as agreed, seems sufficient. Since the algorithm is considering length and depth of payment history, the code is more likely for a young/thin file or one lacking Mix diversity. Link. Link. 


Last edited: 6.17.21 12:08am. © 2021, Birdman7. All rights reserved.

Message 2 of 509
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Re: Credit Scoring Primer - Amount of Debt, Pub.5.17.20


30% - ~165 points





**ccquest has created an awesome Excel sheet that will calculate utilization, balances and ages easily for you at Link.**

A. Utilization

Utilization metrics are scoring factors.


          1. Revolving

i. The major recognized Aggregate revolving utilization thresholds are believed to occur at 5%, 10%, 30%, 50%, 70%, 90%, and 100% (It's possible some scorecards could also have other thresholds.)

ii. The major recognized Individual revolving utilization thresholds are believed to occur at 30%, 50%, 70%, 90%, and 100% (Some scorecards may also have lower thresholds.) (Individual Utilization is calculated from reported balance, which is not always the same as statement balance.)

For max points, you should remain under the lowest thresholds. As you go up, penalties are assessed, more per threshold for aggregate than individual. Typical rounding is used, e.g., you should be able to have a 9.4% balance without going to the next interval of 10% - 29%, but 9.5% = 10%.

See the chart below for a graphical example of the effects of aggregate revolving utilization: 




PLOCs should factor as revolvers, but true chargecards are not revolvers for purposes of the Amounts Owed category. (But they are for Mix.) Link. 


HELOCs should factor as revolvers on Score 2/3, if they are below the revolver dollar cutoff. However, HELOCS don't appear to factor on 5/4 (there were rumors of an update, funny how it factors on 3). On 8/9, HELOCS factor separately and as a ratio to all revolver balances in version 8 at TU and EX. See Codes 62 and 64.


Also know that EQ8 additionally tracks bank/national revolving account utilization without other revolving accounts (Code 89) and then other revolving utilization separately (Code 90). Version 9 distinguishes between credit cards and revolvers. 


          2. Loans


- One metric of loan utilization is aggregate loan utilization of all open loans (current total balances divided by the total original loan amounts) The largest threshold (biggest point award) comes when B/L is <9.5% B/L. (Updated to 9.5% based on new knowledge from Fico experts.) This was discovered by our esteemed Moderator Emeritus Revelate Original thread and his strategy devised is worth 15-35 points (credit to MyFICO Contributor Saeren for top end of range of 35 points on an SSL.). See SSLT thread for detailed information. A smaller award is believed to have a threshold ~65%. Link. Changes seen at other suspected thresholds are believed to be due to changes in total installment balances. There's also a report of a loan threshold ~88% from Remedios.

Long story short, acquire a long-term loan, paydown to less than 9.5%, do tiny autopay for activity. Catch is, it requires a FI that doesn't advance the maturity date and won't work if you have other loans, as installment utilization is based on the aggregate. 


Here is a detailed post from May 2020 of a member going through the process of acquiring an SSL and executing the strategy at Navy. SSLs are/were available at Navy NASA FCU (link in post 7), and SSFCU, and PLs (Personal Loans) are believed to work at Alliant and WF (3k min, $75 fee). PenFed? There are others and these may change. 


-Be aware that while paying aggregate loan utilization to <9.5% gives a nice award, there is also evidence that time open can offer points for installment loans [2]. (Credit: Thomas_Thumb)


Another great discussion of the intricacies of loan utilization by our esteemed Thomas_Thumb: Link. 

It appears all 3 look at aggregate loan utilization while EX and TU also track individually mortgage, auto, and HELOC utilization, as well as a special HELOC balance to revolving balance utilization.


B. Number of Accounts Reporting a Balance/AZEO


The number of accounts reporting a balance impacts score independent of utilization. The higher the number of accounts with a balance, the higher the penalty. (Only at EQ8, the number of bank/national revolving accounts with balances is also a separate scoring factor. Code 23.) Number of accounts reporting a balance is not as heavily weighted on Classic 8, and less so on EX8. Ex.:


EQ BC Fico 8 vs cards reporting a balance.jpg

Credit: Thomas_Thumb


This metric is much more influential for the mortgages scores (especially EX2), which is believed to have lower thresholds. 

There was debate as to whether the account metric's thresholds were raw numbers or percentages. According to fico experts, it can be either/both. They implied it could be a number on thin/young scorecards and a percentage on thick/old scorecards or ? Link. 


Many people think Score 8 has a 33%, a 50%, and maybe a 80% or 100% threshold for this metric as a percentage rather than number. Well, there appears to be one at 20% on EQ8, link, (the weighting may vary by bureau) and the mortgage scores and I've seen too much evidence of the 100% threshold.


There could be 20%, 40%, 60%, 80%, and 100% thresholds or 20%, 50%, and 100%. More testing is advised and hopefully other members can add data for the thresholds. (MyFICO Contributor Trudy's dps lead us to discover this metric includes closed revolvers on EX2. See link. Confirmed. We must still determine whether it is applies to Score 5/4/3/8/9.)


No matter how many revolvers you have, if you only have only one report a balance, then you will be at the lowest possible number/percentage that your profile will allow. (You can't change the fact a loan has a balance, so you can trigger too many accounts with a balance if you have too many loans.)


This has given rise to the infamous AZEO (All Zero Except One) concept. You’ll often hear this recommended, especially for mortgage scores. It doesn’t mean you have to only let one revolver report a balance to be at your best scores, but it guarantees you will be below the lowest threshold possible for your profile for these metrics (which may or may not be one revolver).


Additionally, AZEO is typically recommended as one national bankcard with a small balance. This actually potentially optimizes 3 or more metrics. Number/percentage of accounts with a balance, revolving utilization, and the revolving balance metric(s). 


So, it’s a easy way to give good advice to achieve the best scores, but you may be able to have several revolvers with small balances report and still be at your best scores. You just have to test your individual profile. Also, you don't have to pay interest, just pay after it reports, but before the due date.


A note of caution about your AZEO card. Use a national bankcard with a CL no higher than $31,000, because the mortgage scores exclude cards with higher credit limits. Link. Avoid retail cards, credit union cards, and charge cards, as they can cause unintended consequences.


Typically the more revolvers you have, the more you can have with a balance and still be at your best score. This author recommends at least 5 revolvers at AZEO, 1 loan with B/L < 9.5%, and no inquiries and no new accounts in the last 12 months for reaching your best scores. Also noteworthy, this is a metric that is more reactive on TU and EQ. Many report no changes at EX.


While not counting towards revolving utilization (except on EX2, where the high balance is used as the CL), true charge cards (American Express charge card) do count toward one's number/percentage of AWB (accounts with a balance) metric in Score 8. The reason it's not advised as your AZEO card is next.


C. All Zero Point Loss- (AU Test included)


When all revolvers report $0 balance (AZ), there is a loss of ~10-20 points. If one has AU cards (that are not discounted by the anti-abuse algorithm) and they all report $0 balances, an independent AU AZ point loss will also occur. (A retail card used for AZEO seems to give a partial AZ loss.) EQ8 may penalize for a retail balance? maybe EX? 


This allows to test whether your AU cards are being discounted by the anti-abuse portion of the algorithm on versions 8 & 9. (FICO included this to address TL renting.) Have all AU accounts report $0 and see if you experience a loss. When an AU reports a balance, the points should return. If it does, it's counting. If not, it is not counting for 8 and 9, but will still count for the mortgage scores, as that part of the algorithm didn't exist back then, so they always count for mortgage scores, although lenders realize the score is artificially inflated.


To avoid AZ loss and maximize scores, many people use AZEO, where only 1 national bankcard (and 1 AU BC, if applicable for Scores 8/9) reports a small balance $5-$20. This AZ loss is a frequent post of why did I lose 15 points?


Charge cards are not revolvers and will not save you from AZ losses. Correct, they count for number of AWB, but will not prevent AZ loss. That's because the AZ metrics are based on revolving balance, I believe.


Oh yeah, be careful if you use Chase as an AZEO card and pay it to $0. They automatically off-cycle update $0 balances, so it can cause an unintentional AZ loss. (Credit: SouthJamaica.) However, they can also be the perfect AZEO card as long as you leave a couple dollars when making payment! Also convenient if another card accidentally reports, as Chase will always report the $0, don't even have to ask.


D. COs


The exact mechanisms of how unpaid COs affect utilization are currently under study. We do think an unpaid chargeoff has an effect on utilization. We're just trying to confirm and understand it.


Chargeoffs with balances were considered maxed out cards by common wisdom, but this does not appear to be correct. Further study is ongoing and DPs are appreciated!!. 


At two years sleeping, COs may be taken out of rev. utilization and only penalized for by the Payment History category. Link. See section A for other possible effects due to Payment History.


E. Revolving Balance Metrics-Aggregate and ABORT

We don't know where all the thresholds are, but we do know score is influenced by the aggregate balances on revolvers.


At EQ8, Amount owed on bank/national revolving accounts is additionally tracked. Code 66. TU and EX additionally track mortgage and installment balances separately where EQ doesn't track them at all. TU does not separately track retail balances while the others do. Revolving balances are weighted less heavily than revolving utilization. 


Consequently those with very large TCL's may see score changes from the balance metric and mistake them for utilization because 1% for them may be $5,000 or $10,000 or more.


Average Balance on Revolving TLs (ABORT) also appears to be a scoring metric from fico slides (not sure if it applies to all versions). An average balance under $100 but above $0 appears to be optimal, if the slide is believed to be accurate. 


F. Loan Balance Metrics

The amounts owed on mortgage, open mortgage, and installment loans are considered at TU and EX. Apparently not at EQ; it relies on loan utilization I guess. 


G. Credit Account Balances Metric

Revolving, open-ended, plus non-mortgage loans are included. All bureaus consider this, but we're not sure if all versions do. Notice the estimator asks for this data.


Last Edited: 5.10.21 3:34pm. © 2021, Birdman7. All rights reserved.

Message 3 of 509
Not applicable

Re: Credit Scoring Primer - Length of History/New Credit, Pub.5.17.20


15% - ~82.5 points




Aging related point changes occur on the first of the month. No matter what day an account was opened, it was considered opened the first day of the month in which it was opened by the FICO algo. So adjust your opening dates accordingly to generate accurate metrics. 


Cassie has provided an easy rule for us to follow to determine whether an aging metric may have possibly contributed to a score change: Convert age to months and if the number is evenly divisible by 3, the metric is suspect: Cassie's Rule of 3.


There are many aging-related Scoring Factor (characteristic) pairs inexplicably intertwined as evidenced by being conjoined in reason codes. The most influential, besides the famous first pair, are those related to revolvers (with the exception of the new RBC metric that I believe may become more influential on 9.) I've tried to list them somewhat in an order of guessed influence:


A.AoOA and AAoA


1. AoOA - Age of Oldest Account is a segmentation factor in clean profiles

"AoOA is not a Fico scoring factor. It is a scorecard assignment segmenter. If an increase moves you to a different scorecard your score may change due to a shift in weighting of the factors used in scoring and the assigned min/max scores associated with the scorecard." [4] (Credit: Thomas_Thumb) Link 


A mature profile is more stable and preferred. Penalties are less severe, but awards are smaller. The Score 8 threshold was previously theorized to be between 10-15 years. But it has been found at 3 years! Link.   (It also appears EX2 segments at 2 years based on CassieCard's testing and data. Link.  ) TU4 and EQ5 also segment at 2 years. The reassignment to mature typically has a ~20 point loss, but for some can vary. YMMV. It's really profile specific because the metrics are weighted differently. 


There is only one threshold for AoOA per Version, it's a segmentation factor, and it causes scorecard reassignment; it is not a scoring factor. If you see a point gain at a suspicious AoOA threshold, it's probably an award from AoORA because that is probably the same as your AoOA.

If a credit card is your oldest account, as it is for most people, AoOA=AoORA. These metrics therefore run the same for most people. The lack of realization of AoORA has caused delay in determination of the thresholds for AoOA and AoORA.


2. AAoA - Average Age of Accounts is a scoring factor

It appears these awards are greater on young scorecards, meaning those whose AoOA is < 3 years old for Score 8.

Awards seem to be at multiples of six months

- 3-15 point annual increase

- Maximum award believed to occur by 90 months.


There are 12 and 18 month thresholds on young scorecards, unconfirmed reports of thresholds at 24 and 30 months, and likely thresholds at 60, 66, 72, 78, 84 and 90 months. (K-in-Boston confirmed and reconfirmed the significant threshold at 84 months on a clean/thick/mature/new revolver profile.) I'm sure there are more. Link with links. 


B. AoORA-Age of Oldest Revolving Account and AAoRA-Average Age of Revolving Accounts are scoring factors


FICO never gives away exact thresholds, but we've had a reports of thresholds at 24 & 30 months: link, one at 36 months on a PR scorecard worth 6 points on versions 8 & 2: link, one at 72 months: link, 18 to 29 points, and we also have 2 reports of a possible threshold at 9 years: link. Consider the following from FICO:




Since most people get a revolver first, typically AoORA = AoOA. Therefore, gains are mistaken for AoOA (the segmentation factor) when it's actually AoORA (the scoring factor) that's responsible.

2 similar clean young profiles with similar AoOA and other statistics have significantly different scores, why? One started with a card and the other started with a year loan. AoORA DOES make a difference. Which do you think had the higher score? The one who started with a revolver. 

20 years is sufficient to max AoORA: Link. -BBS. Apparently 9 years is sufficient to max AAoRA. Link. -BBS


C. AoOIA-Age of Oldest Installment Account and AAoIA-Average Age of Installment Accounts are scoring factors


Apparently not tracked by TU8. Negative reason codes point to this metric. Link.


D. AoOOIA-Age of Oldest Open Installment Account and AAoOIA-Average Age of Open Installment Accounts are scoring factors


Apparently not tracked by EQ8. Negative reason codes point to this metric on some variants. LinkLink. 


E. AoOMA-Age of Oldest Mortgage Account and AAoMA-Average Age of Mortgage Accounts are scoring factors

Apparently not tracked by EQ8.


F. AoOOMA-Age of Oldest Open Mortgage Account and AAoOMA-Average Age of Open Mortgage Accounts are scoring factors


Apparently not tracked by EQ8.

G. AoORBC-Age of Oldest Revolving Bankcard and

AAoRBC-Average Age of Revolving Bankcards are scoring factors


H. AoYA-Age of Youngest Account (Number of Months since most recent account opening)


Scoring Factor in 8/9; Segmentation Factor in 5/4/3/2. AoYA = AoYRA, unless the youngest account is a loan. AoYA is a scoring factor for 8/9 and therefore directly gives/takes points there. AoYRA on the other hand is the segmentation factor for 8/9 and affects scores indirectly via scorecard reassignment. Different categories too! Kinda like AoOA and AoORA.


This metric appears to be the source of reported gains at months divisible by 3 on certain files, NOT AoYRA. Notice AoYA does not discriminate against loans, as the "New Credit" category AoYRA segmentation factor does. 




4. NEW CREDIT CATEGORY (No New Revolver/New Revolver)

10% - ~55 points






A. AoYRA - Age of Youngest Revolving Account is a segmentation factor in clean profiles for 8/9.


For Score 8, if you have 0 revolvers/Open-ended accounts (OE) under 12 months of age, you are in a "No New Revolver" scorecard. If you have a revolver under 12 months of age, you're in a "New Revolver" scorecard. All other things constant, There’s typically a ~10-15 point difference.


This is one cause of losing points when a new revolver reports. If you already had one < 12 months, you'll only see changes related to AAoA, AAoRA and utilization when it reports; however, if you had 0 < 12 months of age, you wear a significant penalty as you reassign scorecards, the potential changes mentioned, plus the initial HP, discussed soon.


Loans are not included in AoYRAlink. The metric AoYA does include loans and is a scoring factor on 8/9, but is in the Length of History ingredient.


For 5/4/3/2, AoYA segments profiles into new account or no new account scorecards for the mortgage scores like AoYRA does for 8/9. 


B. Inquiries


Please read the Inquiry Master Thread.


- HPs may count for 0-20 FICO points each, though they are typically <5 points on mature/thick profiles, and higher for young/thin cards. (MyFICO Contributor Cassiecard experienced a 20 point drop for one inquiry on a young/thin scorecard. Proof. )






I believe they cost more on dirty profiles, too. ~ the 9th or 10th inquiry, is a saturation point and there's no further penalty. 


- Hard Inquiries are believed to be “binned.” This means there may be a score loss for the 1st, but not the 2nd, maybe for the 3rd, but not the 4th, etc..  Exact bins are not known and may vary by scorecard.


- Inquiry penalty points are returned at 365 days, unless it falls in a bin. Inquiries will remain on your report for a up to 25 months, but are only scoreable for 1 year.


The purpose of a HP rather than a SP from a creditor is to put the world on notice of your credit seeking behavior, so as to slow your roll and protect their interests, so that you do not overextend yourself or so that at least other lenders have their eyes wide open in lending to you. So be glad when you get an SP CLI.


          i. Buffering/De-duplication of Installment Inquiries


The point loss is immediate for most non-installment HPs, but FICO ignores installment HPs (IF coded correctly) from the preceding 30 days. (Buffering.)

Installment HPs of the same type within 45 day windows are counted as 1 for scoring purposes by the algorithm (14 days for EX2). This is referred to as de-duplication and is designed to allow for rate-shopping. De-duplication does NOT combine installment inquiries across types. A mortgage pull and an auto pull will not be de-duplicated. But 10 auto inquiries within 45 days will only penalize you as if it were 1, scorewise.








Please note that when applying for CCs, most lender computers simply see the raw number of inquiries, not de-duplicated. This causes auto denial for inquiry-sensitive lenders. A solution is not to apply to lenders that do not allow reconsideration (looking at you CapOne). If you apply and are denied for too many inquiries (credit-seeking), a quick call to UW explaining the multiple inquiries are from rate-shopping the same loan will usually cause manual reconsideration.


Soft inquires are inquiries done for various reasons, have no scoring impact and can only be disclosed to the consumer. Examples include: promotional, AR (account review), consumer disclosure, insurance, employment. The type of SP determines the data given.

Promotional inquiries, for instance, do not give account information, just contact demographics. AR gives everything except SPs and consumer disclosures give everything for example. 






C. Spree Penalty "Too many accounts recently opened" reason code Fact/Fiction?


This is a scoring factor that considers how many revolvers < 12? months old exist maybe or this may be like inquiries where one is too many. 

- too many new accounts opened within {0, 30, 60, 90?} days of opening an account may cause an additional "spree" penalty. This penalty is believed to cease at 12 months - CassieCard - but all the details are not known. Probably doesn't affect mature profiles. 


Note: "New Revolver/Account penalty points" are from scorecard reassignment WHEN a new revolver reports and you had no revolver/OE under 12 months of age upon it reporting. (AAoA, AAoRA, AoORA, and utilization changes, if applicable all factor in at once along with everything else upon scorecard reassignment.) Any losses from subsequent revolvers reporting while having one <12 months of age are from AAoA hits, AAoRA hits, and/or balance/utilization changes; these changes also occur in the former situation upon the first card reporting, but because the algorithm accounts for them in one swoop, it is impossible to determine exactly how much of a changes each factor contributes. However, if no aging or utilization thresholds are crossed, that makes educated guesses easier. 


There is no new revolver penalty for a 2nd or subsequent card within 12 months (nor a new account penalty for a 2nd or subsequent account within 18 months for the Mortgage Scores), though losses may come from other metrics.


Getting another revolver 6 months later might not cost you a new revolver penalty, but extends the time you are under it. As a result, I recommend getting what you need in 12 month cycles before the first one reports, as you now have a 12 month penalty and no use in making it longer. Plus you may as well have the best score when you do app, so waiting 12 months allows that award, plus it lets your HPs and new revolvers age and the potential spree penalty to reset.


Last edited 6.23.21 11:09pm. © 2021, Birdman7. All rights reserved.

Message 4 of 509
Not applicable

Re: Credit Scoring Primer - Mix/Dispute/Freeze/Search, Pub.5.17.20


10% - ~55 points






A. Number of accounts is a segmentation factor. (Thick/Thin)


If you have 4 TLs on your CR, you are believed to be in a thick scorecard in Version 9, and maybe all versions were not certain. A thick profile is preferred, penalties are less severe and the score is therefore more stable. Number of TLs has other effects, see 3, below.



B. Mix Diversity


For FICO, there are 5 recognized account types. Having at least one TL on your CR from category i and at least one TL from either category ii or category iii is known to satisfy the "Diversity" scoring metric and give bonuses; it appears the addition of bankcards to a point can give additional points, see below.


The 4th category is not known to give any additional bonus, and the 5th category is negative and penalizes.


i. Revolving (CCs, most LOCs and HELOCs); and Open-ended (True Chargecards, while a separate type of account, are counted as revolvers for purposes of Mix and do not offer additional points);


ii. Non-Mortgage Loans (automobile loans, personal loans, student loans, recreational and vehicle loans, Credit builder loans [SSLs], etc.);


iii. Mortgage Loans Mortgage loans, while installment, are in a category of their own. 


iv. Retail Accounts While these are typically revolving, they are in their own category and don't seem to offer any additional points.


v. Consumer Finance Accounts (CFAs) These are loan tradelines that are considered negative. Finance companies are directed at those with lower credit scores and it is believed each bureau has its own list of those companies. If an institution has the word finance or financial in it, there's a good chance it may be a CFA.

A card/loan on record, open or closed, appears to give a mix diversity bonus, link, 
but open ones can have increased benefits via other categories. 


A lot of people think a mortgage is necessary to get an 850, or that not having one hurts their score. We know from the experts that both statements are false:


Tom Quinn (FICO, VP of Scores):  "There is no characteristic in FICO Scores that penalize a user for not having a mortgage loan." ( Link )




Tom Quinn: "There is no requirement to have an open mortgage to get an 850 score." ( Link )


... but we know the algorithm measures AoOMA, AAoMA, AoOOMA, & AAoOMAs, so if these characteristics do not penalize, they must be measuring in order to reward?


C. Number of Bankcards


Numer of bankcards is a scoring factor for Mix for 8/9, but the exact ideal number is unknown. Closed revolvers may count. (TU4 is sensitive to high number of total accounts as a Scoring Factor.)


For Score 8, it is believed you are leaving significant points on the table unless you have at least 3 bankcards. Upon acquiring your first bankcards, points are awarded and the too few bankcard penalty is reduced. The exact amount is unclear as it occurs upon reporting, which may change many scoring factors and may result in scorecard reassignment on 8/9, if it results in AoYRA < 12 months of age upon reporting where it was previously 12+ months.


When the scorecard reassignment results in a drop, its referred to as the "new revolver" penalty, which can be exacerbated by aging hits. It can be reduced by increased TCL (Total Credit Limit), if it causes thresholds to be crossed. The drop can be partially offset by the "too few cards" penalty being reduced by your first several bankcards or by an award for your first loan (Mix points). Changes in score can also result from the percentage/number of accounts reporting a balance changing, if that changes when a new revolver reports.


Number of bankcards indirectly affects other metrics, as opposed to number of accounts, which is a segmentation factor at all 3 bureaus. The exact optimal number of bankcards is unknown. I recommend no less than 5 revolvers, with no less than 3 being bankcards, if not all. There may be a small benefit to having more than 5/3 that can increase to a point. I don't believe there is a scoring benefit to having more than 10. The increased benefits may stop before 10; impossible to know at this point. I think 5-7 is great, but this is jmho. There is an example Scorecard in the first post under Scorecard Basics where you can see an example of # of bankcards and resulting points.


D. Revolver:Loan Ratio


Revolver:Loan Ratio is a scoring factor at EQ8 and although the exact ideal ratio is unknown, it's believed to be 3:1 or 4:1. Link.  Code 84.


E. Account Exclusion/Removal Timeframes


Chargedoff/Collection accounts are supposed to be removed at 7 years Link.  But at Experian, if they are not currently delinquent, they will remain, just without chargeoff notation. If they're still delinquent/unpaid, the entire account will be removed.

Accounts with a delinquency have the delinquency age off at 7 years and the account may remain until 10 years, like accounts that are closed with no delinquencies which are "supposed to” remain on CR for 10 years, but not always. MyFICO Contributer SouthJamaica reports accounts being dropped after a year being closed, IIRC.


So, while a closed loan satisfies the credit mix diversity scoring factor, who knows when it will disappear? Plus, as discussed in Amounts Owed Section B, supra, having an open loan with B/L equal to or <9.5% offers 15-35 bonus points.


Here is a great discussion of the details of credit mix by our own esteemed Thomas_Thumb: Link. 


In New York there's a 5 year rule and there's also a rule barring debt collectors from venues other than the OC could have enjoyed. See links. I believe the federal rules limit debt collectors' venues. See links. How do CAs determine DOFD? Link. 





You do not want to dispute a frivolous issue or it may end up causing more harm than good. While there our processes to resolve issues with tradeline reporting, every effort should be made to try to informally resolve it with a creditor first, as that is usually the easiest and most expedient method, but if that doesn't work, disputes are available. 


A. Direct Disputes


A direct dispute is an option a consumer has to dispute directly with the creditor (furnisher). One would contact their creditor directly and file said dispute. Sometimes this can get a matter corrected without involving the CRAs, which is the distinction.


If you've done a CRA dispute first, do not advise the creditor/furnisher of that via direct dispute or they may summarily dismiss it without investigation. Link. 


B. CRA dispute


A debtor also has the option of filing a dispute with any or all of the CRAs, which are then required to reinvestigate the allegations within 30 days, if they meet certain requirements. The same issue raised successively may be summarily dismissed without reinvestigation. If you submit additional information before the re-investigation is completed, they are allowed an additional 15 days. There's also a 5 day period for mailing. 

if they cannot verify it (they can use prior information used to insert the TL), they must remove it. If they refuse, you can file a complaint with the CFPB or initiate a civil action. However, if they're able to subsequently verify the information it can be reinserted at a later date. link. 


When you do these by computer or even by hand, if they can scan it in with OCR, it's all handled by computers automatically. That is not to your benefit. In my opinion to give yourself the best chance, hand write your dispute include supporting documentation and mail it CMRRR. (certified mail return receipt requested.) keep copies of everything.


CRA’s must consider supporting documentation. Link. 


C. MOV (Method of Verification) Request


If a CRA dipute comes back denied, as most will, you have the right to submit a Method of Verification request which is essentially a request for how the CRA verified your dispute as accurate. This is nice as your burden in 4 is to disprove the reasonableness of the reinvestigation, so a information  as to how they concluded your account as accurate will go a long way in you showing how the investigation was not reasonable in section D. Check these for more info: Link. Link. 


D. CFPB (Consumer Financial Protection Bureau)/Judicial remedies


If you can't get no satisfaction elsewhere, you may file a complaint with the CFPB or initiate a suit in court contesting the reasonableness of the furnisher's investigation, if you meet the requirements. Link. The CFPB has the responsibility and authority to enforce the FCRA and FDCPA. They may initiate judicial action against a CRA but it is rare. Likewise if they direct the CRA to do something, they are usually motivated to do it, yet they may in some cases filed suit against the creditor to enforce the CFPB's order. Link.  (Consult qualified counsel).





A. Freezing


Congress passed legislation requiring CRAs to allow consumers to freeze their CRs without charge. While frozen, no HPs are possible, BUT new accounts CAN be added. Consequently, a new line of credit is unlikely and ID theft is reduced because most creditors will not extend credit absent a HP. Another advantage is, it may cause one to rethink applying for credit, as it adds another step.


B. Locking


The CRAs, obviously wanting to avold the legislation, devised an alternate method, "locking" your CR. They monetized this and marketed it as easier than freezes, despite the fact that it is no better than freezing. In fact, locking affords the consumer less protection, as it is not subject to the legislation's protections and requirements for freezes. I believe all but Experian now offer locks for free.


C. Fraud Alerts

If you place a fraud alert on your profile, a lender will not extend credit to you until they verify your identity by contacting you via the telephone number on your credit report.


If you do not have a telephone number on your report, you're going to get a hard pull for nothing. So don't place a fraud alert unless you have a current number on there or don't apply for credit and expect mote than a hard inquiry, if you don't have a number there where you can be reached and have a fraud alert active. 

D. Identity Theft Exclusion


If an account appears on your credit report as a result of identity theft, the FRCA provides a remedy. If you file a police report alleging you did not authorize the account, it is a result of identity theft and obtain a police report, the CRA's are required to exclude it from your credit reports. This remedy does not involve the creditor or involve any contact with the creditor. The police report is provided to the CRA and they exclude the account. Link. (Credit: The esteemed Legendary MF contributor RobertEG.) link.



8. SEARCHING THE FORUM (Search Secrets)


Sorry, but the built-in forum search software leaves much to be desired and even more to be found. But not to fret, Google can search just this site for you and even filter it by time period as well as keywords. Try it out, bet you'll find more than you thought.


Here's an example by @Anonymous sharing with the Community how to do so:


General: site:[domain] [keywords] after:YYYY-MM-DD before:YYYY-MM-DD
Example: scoring primer after:2019-01-31 before:2020-10-08
Exact Match Keywords: "lost 20 points" after:2020-10-01
Exclude Keywords (boost): experian -boost before:2020-09-28

No spaces next to any colon (Smiley Happy
Search a range of scores for recent approvals: 630..680 approval after:2020-10-01
(Uses Google range operator, dot-dot between numbers.)


Play with it, make a macro, but search the site with a deep search and limit it by date and keyword for relevance. Oher tricks might come....if those DPs start rollin in....Smiley WinkSmiley Happy


Edited 6.23.21 11:17pm. © 2021, Birdman7. All rights reserved.

Message 5 of 509
Not applicable

Re: Credit Scoring Primer - Mortgage/Reason Codes/9 - Pub.5.17.20



The mortgage Scores react very differently than 8/9. The mortgage scores were actually the general purpose score for the version when they were issued. For example, EX2 is based on the 1998 version and is used as Experian's mortgage Score. It also has bankcard and auto variants which are used. TU4 & EQ5 (and EX3) are based on the 2004 version and likewise have auto and bankcard variants.


So Experian's mortgage score is going to react differently than TransUnion and Equifax's because they're based on different underlying base versions. Even with that said, TransUnion and Equifax's scores still have differences even though they were created from the same version, because their scorecards were generated based on different datasets and then customization.

However we know there's going to be a bigger difference between the Experian Score versus the other two because they are based on different base versions. One thing about all the mortgage Scores is the number of accounts with a balance is a very important metric, more so than utilization. Version 8/9 made utilization more important, that's a big difference between the older and newer scores.


Why are we using such old scores for mortgages? Well because Fannie Mae and Freddie Mac require mortgages to be underwritten on those scores I believe in order for them to purchase them, so all lenders therefore want them to qualify is my understanding. 

The best thing you can do for your mortgage Scores is AZEO, as recommended. Authorized user accounts always count full monty, just like a primary account, so all zero except one, preferably primary, bankcard reporting a balance. You would optimally have no hard inquiries in the preceeding 365 days.


We're not sure about the thick/thin line, but we do know derogatories are treated differently because they only had 2 dirty Scorecards back then as opposed to the 4 starting with version 8/9. My theory is the mortgage scores had a public record scorecard and a delinquency scorecard and Version 8/9 broke those into recent and mature cards.





I'll try to add to this some more but just wanted to give some general information to start building it up. We're still learning a lot about this, so be patient as we learn and add. Suggestions and comments are welcome. 

Good discussion by TT of differences among bureaus relevant to a old mortgage loan being paidoff and closed. (Only loan.) Link. 

CFAs can cost ~20 points across bureaus on a PR card and ~40 points on a delinquency card, according to: link. 





Negative Reason Codes are generated by the fico algorithm at the same time as your score. Each Code is tied to a Reason Statement. These codes/statements give a window into the reason for your score, the reason for score changes, and how you can improve your score. They are listed in the order of precedence:




The following shows an example of how the algorithm generates the negative reason codes:




The only things you know you can use to reliably tell what the algorithm itself is doing it seems are score changes and reason codes, as we know they are the direct output from the algorithms.


The problem is, some CMSs, including MF, change the text of the reason statements. MF calls theirs "Score Factors." These are supposed to be easier to understand, but that can cause confusion because then you don't know which actual reason code and statement it lines up with from the published tables. Contributor iv has thankfully made a Reason Statement/Score Factor concordance chart to assist you in finding the real reason statement & code and has also provided extensions for your convenience to reveal the hidden reason codes in the Score Factors on MF 3B reports. Link. The chart still is nascent and needs our help to be completed, so please contribute DPs! 


Also see this linked table which includes an "(M)" or an "(I)" by codes meaning they are only for the mortgage variant (which never caught on) or the industry option scores (BC and AU). The table is very helpful as it tells you which codes do or do not exist in various variants/versions. A great deal can be determined from this. However, keep in mind that all negative reason codes for a particular version do not exist in every scorecard of that version. This is one of the clues as to what scorecard you may be in


Here's my theory for what it's worth: FICO starts with ~500 characteristics and they run their highfalutin math on the datasets for whatever time period from the respective bureau. It generates the ~20 most predictive characteristics and their weightings for each subpopulation. In other words it generates the different scorecards.


So if you have 4 characteristics in each of 5 categories, that would make the 20 characteristics for your scorecard, for example. But keep in mind, one characteristic can be double-pronged, like the oldest and/or average age reason codes, where one characteristic actually measures 2 separate but related Scoring Factors. Smiley Wink

This generates the algo for that version at that bureau; it is then subject to further customization by fico per CRA request-TT. That's why data can be identical across bureaus and result in a different score. Each bureau's dataset and customization request was different, so the resulting scorecards are different with potentially different weightings and maybe even different characteristics being measured.

We see that one bureau measures certain characteristics where others don't and there's several instances of this as can be seen in Cassie's Score Factor thread and differential post, linked below. For example, one bureau does not penalize for authorized user derogatories. And only Equifax measures the number of revolvers with a balance, it appears. All the others are AWB.

I believe each negative reason
 corresponds to one or more characteristics being measured. For instance, the negative reason code that refers to the oldest or average age of your revolving accounts is signaling that one or both of those characteristics is not in the optimal range, and therefore improvement could award more points.

Cassie has created html reason code tables for you at:




So I figured it was time to add a section for version 9, since many banks have adopted it and there are plenty of questions about it.


Version 9 was built to be an improvement on version 8. We do know all the segmentation points for version 9, except the additional 13th Scorecard that was added for high utilization. That we do not yet understand.


Segmentation points are the same as version 8, except that we are sure of the file being segmented as thick with 4 accounts on version 9. I would argue we are not totally sure for the other versions. So 60 day or worse put you in a dirty card, 3 years makes you mature, 4 accounts make you thick, and 12 months AoYRA, you go to a no-new scorecard.


So what's different what's new? Paid collections are now ignored in addition to nuisance collections which are those under $100. Medical collections are weighted less. A more recent dataset was used to create version 9.

Many of the changes are opposite that of version 8 and are counterintuitive. For instance, the new revolvers reassignment point change seems to go in the opposite direction from version 8 for some.


I will add to this as I think of other things or as we learn other things. Please contribute data points, corrections, or suggestions.


Edited 6.23.21 11:25pm. © 2021, Birdman7. All rights reserved.

Message 6 of 509
Not applicable

Re: Credit Scoring Primer - Bibliography, Pub.5.17.20

12. Bibliography 


Aging delinquency strings versus monthlies:

Attribution for: "...Experian...excludes...delinquencies in a common “string” 7 years from [DOFD]...The other two CRAs have no official, published policy interpretation, and have...excluded based on [DOFD] OR have treated each...delinquency as its own separate adverse item of information, and thus have not excluded...until each has reached...7 years..."

[1]. RobertEG Jan 2020, Permalink. 


Attribution for "installment loans can give points over time irrespective of thresholds"...."As mentioned up thread and shown by a graph, loan age is an actor that influences score outside of B/L ratio on installment loans..."

[2]. Thomas_Thumb May 2017, Permalink 


Attribution for "Utilization less than or equal to one of 9%, 29%, 49%, 69%, or 89% works just fine to avoid the next higher interval."

[3]. CassieCard Feb 2020, Permalink 


Attribution for: AoOA is not a Fico scoring factor. It is a scorecard assignment segmenter. If an increase moves you to a different scorecard your score may change due to a shift in weighting of the factors used in scoring and the assigned min/max scores associated with the scorecard.

[4]. Thomas_Thumb Jan 2018, Permalink 


13. References/Permalinks:


more about Scorecards:

Common abbreviations:


Adding an installment loan -- the Share Secure technique:

good information minutiae of OC recall of collection from CA:

May 2020 example of SSL execution:


NASA FCU $1500 60 month SSL:

Balance threshold @ $147?


Tracking the First Year with Credit Cards:


All Zero Penalty to AZEO (credit angelwingz):


Evidence/References for "AU cards at Zero = Separate Penalty"


If you are just starting your credit:

HOWTO: Get a +62 point FICO 8 jump on a clean file with thanks to @CassieCard


An Application of Credit Scoring: Developing a Scorecard Model :

(An introduction to logistic regression and WOE/IV tables, with R code.)


Installment loan thresholds by Revelate:  


Thomas_Thumb new credit points expected:  


Example of 20-year-old hitting 800 with two years history:  



AimHigh's breakdown regarding statement balance/current balance timing:


PFDs can be done with OCs or CAs:  


Charge off required at 120 days on loan and 180 days on revolver:  


Explanation of how a charge off can drop score upon being paid if not regularly updated:


Explanation of the difference between payment status and current status:


Discussion of good secured cards:  


CAs that do PFD's:


Which banks pull which CRA  


3-year threshold for score 8 AoOA  


2 year threshold for EX2 AoOA  


A balance change can affect score a couple days before it’s reflected in the CMS front end.  


Loan modification is a serious derogatory in fico 9


Accounts in dispute removal for mortgage  


AmEx 3X CLI thread


Explanation of why you cannot rely on values calculated and displayed by CMSs' frontends AKA "Fluff" (Credit to BBS for coining the term, I believe):

800+ is possible with 60 day derogatories

List of links to soft pull preapprovals


Miscoded INQ causing 30 day buffer trigger from cc app?


850 buffers discussion



Utilization re: closed cards


Bankruptcy to 700 in 24 months!


A PR scorecard appears more sensitive to utilization compared to a delinquency scorecard


AAoRA threshold found at 9 years  


Adding a second and third card and the SSL and Paydown


1.5 year average age threshold


CA May not add interest or fees unless permitted by the original debt agreement

Notice requirements for service of process/default judgments without personal service

Last edited: 5.19.21 2:12am. © 2021, Birdman7. All rights reserved.

Message 7 of 509
Not applicable

Re: Credit Scoring Primer Table of Contents, Pub.5.17.20








Where did this come from?

Quick Reference

Brief background

FICO scoring and these forums

FICO Score 8 key differences

Rating/Score range

So, how does scoring work in FICO Score 8?





Payment History



Amount of Debt



Length of History



New Credit



Credit Mix


Start Birdman7

Scorecard Basics





35% - ~192.5 points          

A. Derogatory Categories

B. Collections/CA/Dunning notice/DV

C. Aging Derogatories

         i. Scoring

         ii. Derogatory Removal

         iii. CR Removal Quick reference

         iv. Judicial SOL (Statute of Limitations)

  D. Amount Still Owed on Delinquent Accounts
  E. Multiple Delinquency Penalty

  F. Recency

  G. Number of Accounts Paid as Agreed





30% - ~165 points

          A. Utilization

                 i. Revolving

           a. Aggregate
           b. Individual
             ii. Loan

          B. Percentage/Number of Accounts Reporting Balance/AZEO

          C. All Zero Point Loss-(AU Test included)

          D. CO

          E. Revolving Balance Metric-Aggregate and ABORT

          F. Loan Balances Metric

          G. Account Balances Metric





15% - ~92.5 points

       A. AoOA and AAoA

1. AoOA-Age of Oldest Account is a Segmentation Factor in clean profiles

2. AAoA-Average Age of Accounts is a scoring factor

B. AoORA-Age of Oldest Revolving Account and AAoRA- Average Age of Revolving Accounts are scoring factors

C. AoOIA-Age of Oldest Installment Account and AAoIA-Average Age of Installment Accounts are scoring factors

D. AoOOIA-Age of Oldest Open Installment Account and AAoOIA-Average Age of Open Installment Accounts are scoring factors

E. AoOMA -Age of Oldest Mortgage Account and AAoMA-Average Age of Mortgage Accounts are scoring factors

F. AoOOMA-Age of Oldest Open Mortgage Account and AAoOMA-Average Age of Open Mortgage Accounts are scoring factors

G. AoORBC-Age of Oldest Revolving Bankcard and AAoRBC-Average Age of Revolving Bankcards are scoring factors

H. AoYA-Age of Youngest Account is a scoring factor for 8/9, segmentation factor on 5/4/3/2


4. NEW CREDIT CATEGORY (No New Revolver/New Revolver)

10% - ~55 points

A. AoYRA - Age of Youngest Revolving Account (Segmentation Factor on 8/9)

B. Inquiries

              i. Buffering/De-duplication of Installment Inquiries

       C. Spree Penalty - "Too many accounts recently opened" reason code - fact/fiction?





10% - 55 points

A. Number of Accounts (Segmentation Factor)

B. Mix Diversity

      i.  Revolving and Open-ended

     ii.  Non-Mortgage Loans

     iii. Mortgage Loans

     iv. Retail Accounts

     v.  CFAs

C. Number of Bankcards

D. Revolver:Loan Ratio

E. Account Removal



A. Direct disputes.

B. CRA disputes

C. MOV Request

D. CFPB/Judicial remedies 



A. Locking

B. Freezing

C. Fraud Alerts

       DIdentity Theft Exclusion

8. SEARCHING THE FORUM (Search secrets from CassieCard)







 With Link to Cassie's Score Factors Thread (Has Negative Reason Code Charts)








13. References/Permalinks



14. TOC/Index 




Post 10- Additional helpful info!


Return to beginning of thread. 





A very special thanks to @Anonymous , my Technical Advisor, for assisting with technical issues, tables, images, research, attribution, adding great links and information, the presentation of this thread, encouragement and so much more. Would not have been anywhere near as nice, comprehensive, and robust without her help. Thank you! And thank you for your continued help in keeping this updated and a wonderful resource for all members. 


The above posts are from what I have learned from this forum and from my own testing. They represent the best knowledge we have, but that doesn't mean there may not be errors. There is quite a bit we still don't know and probably never will. Nevertheless, I have done my best to present the best information possible IMHO.


If you find errors, please LMK. If you think something should be added, LMK. If you think something is unclear or needs clarification, LMK.


Thank you to all our members for helping each other and keeping this forum strong!


Also, I would like to give proper attribution for theories and discoveries. Please LMK if one of the findings is yours. If so, LMK and provide the link and I will add it.


To be added:


1. Any requests?




Last edited: 5.7.21 3:19pm. © 2021, Birdman7. All rights reserved.

Message 8 of 509
Moderator Emeritus

Re: General Scoring Primer and Version 8 Master Thread rev.5.17.20

Fantastic and thank you and also everyone else that has helped put it together or contributed.


Couple of things:


You define some acronyms inline but others like TL aren't; actually it might make sense to just make an acronym list as well, maybe the important ones and then link to the forum acronym list if it can be found again haha.  Probably in helpful threads pinned somewhere.


Speaking of information organization, might I suggest a table of contents and then break things into sections in individual posts akin to the Helpful Threads posts when we consolidated stickies?  Also collect like information, aging and associated metrics metrics on one page, derogatories on another, derogatory remediation separate... they are all kind of jumbled together now or at least that's how it read to me on first glance.  Apologies I only pick on such things because I am having to write a pseudo ISO compliant document right now for one of my gigs and structure matters.


Actually on second read it isn't as muddled as I thought but it's written in essay format, you might want to switch some of the order up like put the optimal values front in center near the top instead of at the end where it lands today.  That might allow to put more detailed information which would lose the casual reader further down thread.


I think we know some additional details for scorecard segmentation, vis a vis lates segment different than public records seemingly and actually a 30D late is a minor delinquency and sorts top 8 in every FICO model I have seen.


Did I miss a reference on FICO 8 patterns?  Namely: "With too many 30 day lates within a period of time, you’ll go to a dirty card. It’s unknown how many it takes, though." ?


I will try to read through more carefully later, in my own documentation hell right now and I need a nap too.

Message 9 of 509
Not applicable

Re: General Scoring Primer and Version 8 Master Thread rev.5.17.20

Score Factors / Reason Statements with explanations are in a separate Score Factors topic.


There are explanations for all reason codes and associated statements on EX 8, TU 8, EX 2, TU 4, and EQ 5.

Message 10 of 509
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