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@Anonymous wrote:
We also have official confirmation that revolving balances are considered independent of revolving utilization.
^ Agreed
Thanks to all those who furnished questions and answers
My key confirmations/takeaways were:
1) Aggregate revolving balance is considered as a dollar amount
2) Aggregate revolving balance is considered as a ratio to total available credit (utilization). This factor is more heavily weighed than #1
3) Individual revolving acount utilization is a factor in scoring based on highest card utilization. So step down utilizations across the board - don't leave one card at a high level ... unless it is a 0% APR promotion and the penalty is a non issue to you.
4) Number of accounts with balances is a scoring factor - no clarification on revolvers+ charge card accounts only or if count includes installment loans. Testing suggests installment loans are included in count.
5) Percent of accounts with balances is a scoring factor. No real clarification if that is limited to revolvers + charge cards only.
6) Open mortgages have never been required to get an 850 score. The question not asked/left unanswered is ability to reach 850 with out an installment loan of any type on file (open or closed). I'll have a data point on this later in the year.
7) Zero revolvers with balance penalty and no open loans penalty were known to exist but good to have them validated.
8) True AMEX charge cards (called "open accounts") do not factor into aggregate balance or utilization. However, I wonder if that statement overlooked Fico 98 (EX score 2) where I did see score penalties associated with high reported balances on my AMEX Green card - no impact on Fico 04 (EX score 3)
9) Balances on closed revolving accounts can be included in the aggregate balance and utilization. Wording did not say must - perhaps this can be dictated by the cra.
No insight provided on threshold values for revolving aggregate in $ or %. Good to clarify that rounding is to nearest %. Still think 9% or less is a thing but, the penalty would kick in at 9.5%, not 9.0%. So, the report will say 10%. [side note: Some other scoring models look at utilization to the nearest 0.01% but, our Fico experts state whole numbers are used for Fico models]
Unfortunately, nothing really shared regarding segmentation for scorecards so I'd say stick with collective wisdom gleaned from past FICO presentations.
@SouthJamaica wrote:I would like to thank all the FICO staff who participated in providing answers to the questions.
This was quite informative, and -- I dare say -- settles a few bets.
Yes, it was informative and I'm also thankful they took the time to respond.
Wait....you won actual FICO$ on here?
(I think we're even? If not...I only have about 25 FICOs until my AoYRA hits 1 year. lol)
@Thomas_Thumb wrote:
@Anonymous wrote:
We also have official confirmation that revolving balances are considered independent of revolving utilization.^ Agreed
Thanks to all those who furnished questions and answers
My key confirmations/takeaways were:
1) Aggregate revolving balance is considered as a dollar amount
2) Aggregate revolving balance is considered as a ratio to total available credit (utilization). This factor is more heavily weighed than #1
3) Individual revolving acount utilization is a factor in scoring based on highest card utilization. So step down utilizations across the board - don't leave one card at a high level ... unless it is a 0% APR promotion and the penalty is a non issue to you.
4) Number of accounts with balances is a scoring factor - no clarification on revolvers+ charge card accounts only or if count includes installment loans. Testing suggests installment loans are included in count.
5) Percent of accounts with balances is a scoring factor. No real clarification if that is limited to revolvers + charge cards only.
6) Open mortgages have never been required to get an 850 score. The question not asked/left unanswered is ability to reach 850 with out an installment loan of any type on file (open or closed). I'll have a data point on this later in the year.
7) Zero revolvers with balance penalty and no open loans penalty were known to exist but good to have them validated.
8) True AMEX charge cards (called "open accounts") do not factor into aggregate balance or utilization. However, I wonder if that statement overlooked Fico 98 (EX score 2) where I did see score penalties associated with high reported balances on my AMEX Green card - no impact on Fico 04 (EX score 3)
9) Balances on closed revolving accounts can be included in the aggregate balance and utilization. Wording did not say must - perhaps this can be dictated by the cra.
No insight provided on threshold values for revolving aggregate in $ or %. Good to clarify that rounding is to nearest %. Still think under 9% or less is a thing but, the penalty would kick in at 9.5%, not 9.0%. So, the report will say 10%. [side note: Some other scoring models look at utilization to the nearest 0.01% but, the text answers mention whole numbers for Fico models]
Unfortunately, nothing really shared regarding segmentation for scorecards so I'd say stick with collective wisdom gleaned from past FICO presentations.
The key takeaways for me were:
1. balances expressed in raw dollars are a factor, but weighted less heavily than balances expressed as a percentage
2. balances on closed accounts may be considered in revolving utilization (but the answers were unclear as to whether the limits on those accounts can be considered as well)
3. the 'front end' analytics on the website are not 'fluff' but are part of the analytics that go into developing the scores
4. the percentages rounded to the nearest integer, which are found in the 'front end' analytics, are the percentages which affect the scores
5. the all zero penalty and the no open loan penalty are definitely part of FICO's plan
6. according to FICO the above penalties are not based on any philosophy, but on experience that all-zero balances are slightly more predictive of risk than low balances
It would've been nice to have more clarification about that AU utilizations question
I just had my AU charge reporting a balance along with 1 revolver and my score is lower than before, all things the same.
Trying to dispute it on EX and Amex verifies it as accurate
TU lets me delete it instant and my score rises
@Anonymous wrote:It would've been nice to have more clarification about that AU utilizations question
I just had my AU charge reporting a balance along with 1 revolver and my score is lower than before, all things the same.
Trying to dispute it on EX and Amex verifies it as accurate
TU lets me delete it instant and my score rises
Not sure they could provide a simple answer. The whole AU account evaluation is convoluted with the anti-abuse half baked algorithm.
It was interesting to learn that percentage of on time payments is indeed factored in despite conventional wisdom on here.
@Brian_Earl_Spilner wrote:It was interesting to learn that percentage of on time payments is indeed factored in despite conventional wisdom on here.
@Brian_Earl_SpilnerI'm not sure that was resolved in that context. Anything less than 100% penalizes. (Exceptions are new files that dont' have any established payment history. Obviously a certain minimum amount of payment history has to established.) Anything can be converted to a percentage and the more lates, the more penalty and the percentage drops.
@Thomas_Thumb wrote:
@Anonymous wrote:
We also have official confirmation that revolving balances are considered independent of revolving utilization.^ Agreed
Thanks to all those who furnished questions and answers
My key confirmations/takeaways were:
1) Aggregate revolving balance is considered as a dollar amount
2) Aggregate revolving balance is considered as a ratio to total available credit (utilization). This factor is more heavily weighed than #1
3) Individual revolving acount utilization is a factor in scoring based on highest card utilization. So step down utilizations across the board - don't leave one card at a high level ... unless it is a 0% APR promotion and the penalty is a non issue to you.
4) Number of accounts with balances is a scoring factor - no clarification on revolvers+ charge card accounts only or if count includes installment loans. Testing suggests installment loans are included in count.
5) Percent of accounts with balances is a scoring factor. No real clarification if that is limited to revolvers + charge cards only.
6) Open mortgages have never been required to get an 850 score. The question not asked/left unanswered is ability to reach 850 with out an installment loan of any type on file (open or closed). I'll have a data point on this later in the year.
7) Zero revolvers with balance penalty and no open loans penalty were known to exist but good to have them validated.
8) True AMEX charge cards (called "open accounts") do not factor into aggregate balance or utilization. However, I wonder if that statement overlooked Fico 98 (EX score 2) where I did see score penalties associated with high reported balances on my AMEX Green card - no impact on Fico 04 (EX score 3)
9) Balances on closed revolving accounts can be included in the aggregate balance and utilization. Wording did not say must - perhaps this can be dictated by the cra.
No insight provided on threshold values for revolving aggregate in $ or %. Good to clarify that rounding is to nearest %. Still think 9% or less is a thing but, the penalty would kick in at 9.5%, not 9.0%. So, the report will say 10%. [side note: Some other scoring models look at utilization to the nearest 0.01% but, our Fico experts state whole numbers are used for Fico models]
Unfortunately, nothing really shared regarding segmentation for scorecards so I'd say stick with collective wisdom gleaned from past FICO presentations.
Totally agreed, with the caveat that I believe there are 2 scoring factors, or as they call them, characteristics; there may be 4: #of revolvers w/ a bal, # of accts, w/ a bal, % of revolvers w/ a balance , and % of accounts with a balance. Seems # is more prevalent in thin or young files whereas % trumps in thick or mature files.
@Anonymous wrote:
@Brian_Earl_Spilner wrote:It was interesting to learn that percentage of on time payments is indeed factored in despite conventional wisdom on here.
@Brian_Earl_SpilnerI'm not sure that was resolved in that context. Anything less than 100% penalizes. (Exceptions are new files that dont' have any established payment history.) Anything can be converted to a percentage and the more lates, the more penalty and the percentage drops drops.
It pretty much was. While they weren't talking about the higher percentage of on time payments on an account, they mention number of accounts that are paid as agreed. That would mean adding more on time accounts would have a positive outcome for someone that has missed a payment.
@Brian_Earl_Spilner wrote:
@Anonymous wrote:
@Brian_Earl_Spilner wrote:It was interesting to learn that percentage of on time payments is indeed factored in despite conventional wisdom on here.
@Brian_Earl_SpilnerI'm not sure that was resolved in that context. Anything less than 100% penalizes. (Exceptions are new files that dont' have any established payment history.) Anything can be converted to a percentage and the more lates, the more penalty and the percentage drops drops.
It pretty much was. While they weren't talking about the higher percentage of on time payments on an account, they mention number of accounts that are paid as agreed. That would mean adding more on time accounts would have a positive outcome for someone that has missed a payment.
Respectfully I think they were referring to when you add your second and third revolving accounts, which adds points by reducing the too few bankcard penalty. Jmho.