Do Negs Hurt a Good Profile More?

[krit]

I remember reading that one neg will harm a good profile more than a bad one. Is this true? I have a decent profile other than a 6.5-year-old collection.

I have ~4.5 AAoA and 20 accts, 11 open (10 revolving and one installment) with perfect pmts. Yet my scores remain in the high 600s.

In your opinion, can I expect to see a big score jump once that collection falls off in four months? If not, I'm at a loss. What else could be at play here?

Thank you for your insight. 

[AndySoCal]

If there is no other negative information you should see a nice jump in the score once the collection account falls off.

[NYC_Fella]

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@krit wrote:

I remember reading that one neg will harm a good profile more than a bad one. Is this true? I have a decent profile other than a 6.5-year-old collection.

I have ~4.5 AAoA and 20 accts, 11 open (10 revolving and one installment) with perfect pmts. Yet my scores remain in the high 600s.

In your opinion, can I expect to see a big score jump once that collection falls off in four months? If not, I'm at a loss. What else could be at play here?

Thank you for your insight. 

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I have a very similar file to yours, except that I have 3 negatives plus a BK7. My scores have hovered around 700 for the last year or so. You should be at least in the 680-690 range unless you have a bunch of new inquiries.

[SouthJamaica]

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@krit wrote:

I remember reading that one neg will harm a good profile more than a bad one. Is this true? I have a decent profile other than a 6.5-year-old collection.

I have ~4.5 AAoA and 20 accts, 11 open (10 revolving and one installment) with perfect pmts. Yet my scores remain in the high 600s.

In your opinion, can I expect to see a big score jump once that collection falls off in four months? If not, I'm at a loss. What else could be at play here?

Thank you for your insight. 

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1.  Yes of course removing the only negative from an otherwise positive profile would have more impact than removing one negative from a file loaded with negatives, and yes removing your only negative can have a major effect on your scores.

2.  As to what else is at play, there are almost definitely other things at play in your case, but how can we even guess as to what they are unless you tell us what's in your credit profile? Making "perfect payments" is just a small part of the equation. We would need to know the limits and current balances on your revolvers, and the original loan amount and current balance on your installment loan.

[NRB525]

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@krit wrote:

I remember reading that one neg will harm a good profile more than a bad one. Is this true? I have a decent profile other than a 6.5-year-old collection.

I have ~4.5 AAoA and 20 accts, 11 open (10 revolving and one installment) with perfect pmts. Yet my scores remain in the high 600s.

In your opinion, can I expect to see a big score jump once that collection falls off in four months? If not, I'm at a loss. What else could be at play here?

Thank you for your insight. 

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In general, with FICO scoring, when you get into the items that affect score beyond the basics, then yes, the second and third instances of those have less effect.

Payment on time is the baseline expectation.

Miss one payment at 30 days, it'll be a significant hit to score. Miss two payments at 30 days, the second one has less of a hit. But then again, the cardholder has already had the one 30 day late, so that's not a good place to be.

By the time you get to a collection, then that one instance is still piling on the additional negative effects, as 30 days stretches to 90 days, then to the collection. Now, if you added another 30 day late, with the collection still in place, that 30 day late I would guess would not be as many points as, from no negatives, adding the first 30 day late. But the only reason this 30 day late would be "less effect" is... due to the existing collection, again not a good place to be.

So yes, work on getting the collection removed, and score should jump nicely.

Good luck!