I've been on and participated in these board for a few years. I used to work for Experian so I know the game between that and these board that have been really useful. But here's the thing. I racked up some CC debt during Covid but recently did a refi on my house with cash out and have paid most of that CC debt off. The new mortgage hasn't hit yet but I had one card report balance drop of $12K...score dropped 3 pts. Another down almost $1k reported, no change. Another increased by/to $124 ($9k+ limit) ...ONE HUNDRED AND TWENTY FOUR DOLLARS... the payoff was recorded on the CC site but I guess not before they reported the $124...another 3 point drop. It's not the number of points since it's small drops but I'm just astounded at the BS of this. You pay off, you get penalized...you run any balance, you get penalized. Seriously for real?? I'm almost afraid what's going to happen when the other big boys I paid off report. I'll probably be in the low 600s. Still hanging around 700 now due to the debt pileup but not at the rate I'm getting penalized for paying them off. God forbid I try to run AZEO, I'll get torched. Probably better for me AZE2 or AZE3 which I pretty much have set up already. I'm not looking for new credit at all so that's not my point, I just get FICO alerts and I'm just like "Why are the scores dropping?". Guess I'll see if any insight on the boards. #end_rant
@Buckwheat2U wrote:I've been on and participated in these board for a few years. I used to work for Experian so I know the game between that and these board that have been really useful. But here's the thing. I racked up some CC debt during Covid but recently did a refi on my house with cash out and have paid most of that CC debt off. The new mortgage hasn't hit yet but I had one card report balance drop of $12K...score dropped 3 pts. Another down almost $1k reported, no change. Another increased by/to $124 ($9k+ limit) ...ONE HUNDRED AND TWENTY FOUR DOLLARS... the payoff was recorded on the CC site but I guess not before they reported the $124...another 3 point drop. It's not the number of points since it's small drops but I'm just astounded at the BS of this. You pay off, you get penalized...you run any balance, you get penalized. Seriously for real?? I'm almost afraid what's going to happen when the other big boys I paid off report. I'll probably be in the low 600s. Still hanging around 700 now due to the debt pileup but not at the rate I'm getting penalized for paying them off. God forbid I try to run AZEO, I'll get torched. Probably better for me AZE2 or AZE3 which I pretty much have set up already. I'm not looking for new credit at all so that's not my point, I just get FICO alerts and I'm just like "Why are the scores dropping?". Guess I'll see if any insight on the boards. #end_rant
Your scores do not drop because you reduce your balances. It's simply not true that "You pay off, you get penalized". If you gave specific details we might be able to give you specific answers.
Your scores didn't drop from the pay off. More than likely from the HP for your refinance. The update just happened to align with the pay off.
As you posted you used to work for EX. That doesnt mean you have the inside workings of the algorithm that makes a score. If you did you wouldnt be asking these questions. Lowering util % as others have said wont have your scores go down. Now the question is where are you seeing these score swings? Theres no joke.You ran up the debt. Great your pying it down. But score changes dont happen overnight.
It's probably coincidental and the other posters are correct, I don't have insight into the algorithms and yes I did rack up the debt so my bad. I'll just shut up about it and let it run it's course. It will likely even out in the end, just frustrating sometimes so I vented and probably not the place to do it. Apologies.
No worries. Some changes can take a couple updates to occur. It isnt instant. I paid this and it says this. Eventually it will catch up. I use this for an example. Can you explain this? I cant. 1 day. No changes. See how it works? Whacky!
@FireMedic1 wrote:No worries. Some changes can take a couple updates to occur. It isnt instant. I paid this and it says this. Eventually it will catch up. I use this for an example. Can you explain this? I cant. 1 day. No changes. See how it works? Whacky!
I can explain it, and I am surprised that you do not understand it yourself. On that morning, do you not remember seeing a four leaf clover, right after a white cat crossed your path? That is the clear explanation.
Had a friend at Fair Isaac who ran a modeling team there. His general comment is that all their models are correlative, not predictive. The just look at lots of data and have no idea why these things happen, just that a large number of people who were fine last month and defaulted this month had these data changes over the previous several months. That is why some of these rules seem to make no real sense.