EXCEPTIONAL amt of debt?

[Anonymous]

I imagine you'll get the "excellent" after you've carried no balances and made on time payments for one whole year.

But it's really only designed to make you feel good in the hope you'll app through them as has been stated.

[Anonymous]

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@Anonymous wrote:

Great replies above from other members regarding the CMS fluff in using words like "exceptional" and "very good" to assign arbitrary "ratings" for different scoring categories.

OP, think of it this way.  You could have two otherwise identical profiles, both at the same (say, 5%) overall utilization.  A CMS might say that both of these individuals have "exceptional" revolving debt.  What you don't know however is that one individual may have $3000 in total limits where the other has $400k in overall limits.  Would we really say that someone with $150 in revolving debt is "equal" [rating wise] to someone with $20k in revolving debt?  CMS fluff may lead one to believe so, when clearly both individuals are not created equal.

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even without the fluff messages, it looks like the problem is that the fico algorithms are mostly based on ratios, which can lead to a false comparison or ridiculous situation like that.

for example i only have 2 cards on my reports right now, and let a balance report on both: $15 and $173. computer says too many accounts with balances! but if i let just one card report a balance i still have 50% of my cards reporting balances, it's probably still too high a ratio?

if i have a good DTI and low util, why would how many cards with balances even matter? why should it be better that $15 was charged onto the other card instead. especially when the amount of money in play is so insignificant. but they don't care about high income and low debt, or the low absolute value of the debt, all they care is the ratio of how many cards with a balance. so they punish me for it with a lower fico score.

[BallBounces]

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@Anonymous wrote:

I imagine you'll get the "excellent" after you've carried no balances and made on time payments for one whole year.

But it's really only designed to make you feel good in the hope you'll app through them as has been stated.

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The fluff statement of EXCEPTIONAL has nothing to do with time since late and nothing to do with carrying no balances for any interval.  Nothing.

It showed up on mine after going to "4%" by their fluff calculation.    I have a major derogitory that is 8 months old.  UTL was over 50% as recently as 3 months ago.

As we all agree, the fluff statement is irrelevant anyway, but there you have it.

[Anonymous]

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@Anonymous wrote:

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for example i only have 2 cards on my reports right now, and let a balance report on both: $15 and $173. computer says too many accounts with balances! but if i let just one card report a balance i still have 50% of my cards reporting balances, it's probably still too high a ratio?

if i have a good DTI and low util, why would how many cards with balances even matter? why should it be better that $15 was charged onto the other card instead. especially when the amount of money in play is so insignificant. but they don't care about high income and low debt, or the low absolute value of the debt, all they care is the ratio of how many cards with a balance. so they punish me for it with a lower fico score.

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Too many accounts with a balance does not have to be a factor that impacts your score in a big way.  I see that negative reason statement with 2 accounts with a balance (1 loan and 1 revolver out of 7 total) so I'm at 25% of total accounts with a balance, but only 15% of revolvers.  So yes, no doubt that negative reason statement can be generated with just 2 accounts with a balance.  But, it really doesn't matter much.  I have 850 scores across all 3B, for example.

You referenced DTI above.  DTI is not a Fico scoring factor, as the algorithm does not consider income at all.  There are hundreds of thousands of people out there in the world that have massive income levels but still don't pay their bills on time and have garbage Fico scores.  Ratio/number of accounts with a balance is far less meaninful than overall reported utilization percentage.  Not sure what you mean about $15 being charged to your other card being "better."  In terms of Fico scoring, if you have 2 revolvers and one of them already has a reported non-zero balance ($173) taking your other revolver from $0 reported to $15 would hurt your scores, because you moved to more accounts with a balance (100% instead of 50%).

[Anonymous]

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@Anonymous wrote:

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for example i only have 2 cards on my reports right now, and let a balance report on both: $15 and $173. computer says too many accounts with balances! but if i let just one card report a balance i still have 50% of my cards reporting balances, it's probably still too high a ratio?

We have similar profiles.

Here is what my last myFICO 3B shows for October 10, with 10 months total revolving history (out of 1yr 10mo total credit history):

So even with 10 months of revolving history and only 1% aggregate utilization, it's still just 'Very Good'.

'Payment History' changed from 'Very Good' to 'Exceptional' at 3 months total revolving history. (AoYA 3mo, both cards same age.)

And here is what happens when you only have 2 cards and only one reports a balance with aggregate utilization at 1%. That shows changes to all 28 FICO scores. EQ 8 +19, TU 8 +14, TU FICO 9 +27, etc.

You'll still have the 'Too many accounts with balances' reason, as can be seen at the link above.

[Anonymous]

@Anonymous wrote:

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So even with 10 months of revolving history and only 1% aggregate utilization, it's still just 'Very Good'.'Payment History' changed from 'Very Good' to 'Exceptional' at 3 months total revolving history. (AoYA 3mo, both cards same age.) And here is what happens when you only have 2 cards and only one reports a balance with aggregate utilization at 1%. That shows changes to all 28 FICO scores. EQ 8 +19, TU 8 +14, TU FICO 9 +27, etc. You'll still have the 'Too many accounts with balances' reason, as can be seen at the link above.

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yes, this is very interesting. ballbounces says 4% pops the exceptional message instantly for them. but for me i have hit 2% a couple times and it didn't pop, and for you there's multiple months going by without ever seeing that message. i think we might have just figured out why... it must be that reason code: "too many accounts with balances."

right now i have all these codes as "key factors" affecting my score

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length of time accounts have been established

lack of recent installment loan information

length of time revolving accounts have been established

too many accounts with balances

out of those it's the only one that seems to directly relate to an "amount of debt"

the length of time codes are not clear if they pertain to the single oldest account or to the average age. i wish we had more information about all these reason codes.

[NRB525]

OP, why are you concerned about the fluff descriptions?

If you are reporting two of two accounts with $200 total balances, on a six month file, with no missed payments, you are doing it right.

With only 6 months history, you have some limits on what you can expect for approvals, but that’s just a reality of a young file, it’s not a negative you can overcome with these descriptors.

If you miss a payment, that will definitely change your options, but you know better than that, so nothing to worry about there.

[Anonymous]

i'm just trying to figure out how it works to improve my score a bit more. i already added a 3rd card and it will begin reporting soon, so maybe i can avoid triggering that code if i have 1/3 cards reporting a balance. the other thing i could do is open an installment loan and see how much that helps things because it's listed as #2 on my reason code list. i think the order of the codes in the list shows which one affects you the most.

[BallBounces]

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@Anonymous wrote:

i'm just trying to figure out how it works to improve my score a bit more. i already added a 3rd card and it will begin reporting soon, so maybe i can avoid triggering that code if i have 1/3 cards reporting a balance. the other thing i could do is open an installment loan and see how much that helps things because it's listed as #2 on my reason code list. i think the order of the codes in the list shows which one affects you the most.

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I am all for "figuring it out".  The problem is the fluff description on a CMS interface is not the data you should use to "figure it out".

For example ... my score did not change when the EXCEPTIONAL description showed up.  That is not relevant data.

[Anonymous]

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@Anonymous wrote:
i already added a 3rd card and it will begin reporting soon, so maybe i can avoid triggering that code if i have 1/3 cards reporting a balance. the other thing i could do is open an installment loan and see how much that helps things because it's listed as #2 on my reason code list. i think the order of the codes in the list shows which one affects you the most.

Yes, those reasons have a certain weighting to them. Every 3 months (AoYA 3mo, 6mo, and 9mo) I've seen that 'Short revolving credit history' reason move down 1 spot in the list on many scores. It will be there for many years I'm sure, but it doesn't really matter.

'At least 3 cards with only 1 reporting a small balance and an open installment loan with less than 9% remaining balance' is commonly referred to as 'optimal' here. I saw a +62 point jump on my TU FICO 8 score when my 'credit builder' loan hit 8.47% remaining. (Half of that is from aging to 1 year without opening a new account. Expect 25-30pts without the aging gains.) Once the loan is paid off though, all those points go away.

There's something else to consider as well - time. I'm on track to have all 3 FICO 8 scores near 785 on my January 10 3B report. 20 will come from AoYA 1yr and around 18-20 pts from having no inquiries under 1 year at all 3 CRA's. (Thin files get hit much harder for inquiries!)

The thing is, my total credit history will only be 2 years and 1 month, with only 1yr 1mo total revolving history. It's just not the same to lenders as someone with that same score and 5 years history, for example.