FICO score went up after balance reported!? I don't get it.

[renclan]

Ok guys,

I have read so many posts on these forums about paying off all of your cards to $0 except for one. I  have worked so hard over the last month and have managed to pay all of them to $0 except for 2. I had one that has been reporting zero since last month and decided to use it for a small charge to keep it active. Imagine my dismay when I realized I missed the cutoff date for my statement and this month posted a $12 balance. The weird thing is that MyFico alert says my score increased 9 points from a balance increase of $0 >>$12. I don't get it. Why would my score go up after reporting a balance instead of 0? Does this mean that having all of those others report 0 instead of a tiny balance is going to hurt me? Thanks!

[gdale6]

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@renclan wrote:

Ok guys,

I have read so many posts on these forums about paying off all of your cards to $0 except for one. I  have worked so hard over the last month and have managed to pay all of them to $0 except for 2. I had one that has been reporting zero since last month and decided to use it for a small charge to keep it active. Imagine my dismay when I realized I missed the cutoff date for my statement and this month posted a $12 balance. The weird thing is that MyFico alert says my score increased 9 points from a balance increase of $0 >>$12. I don't get it. Why would my score go up after reporting a balance instead of 0? Does this mean that having all of those others report 0 instead of a tiny balance is going to hurt me? Thanks!

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The best Fico scoring from revovling usage is different for everyone even including the number of cards that carry a balance. If your score was increased with 2 cards reporting then by all means let 2 cards report a small balance, you have to experiement to find your sweet spot its not uniform for everyone. The guidance of only having 1 card report a small balance does work for quite a few but not all as you have just discovered.

[NRB525]

It is part of the trending noise. Your scores are below 700, which implies you are coming back from some sort of negatives, either major or minor, in your credit file. As you continue to put more months of positive payment history in your file, and those baddies fade or drop, you will see gradual increases like this. Those gradual increases have to have some trigger event, usually reporting of a CC, so the coincidence of this new $0 to $12 was simply the trigger for that new score calculation. And I think it is probably part of a general trend of score increases over the last few months for you, correct?

I'm still not in favor of letting all cards report zero, but the larger question of the individual's credit profile and increases due to positive payments is my guess as to why the small increase with this report.

[Anonymous]

And it may well not be that the increase caused the score increase. Only certain things trigger a score update, you may have had 5 cards report oks on your report, but my fico didnt update that, the balance change was simply the triggering update on the score. For example,2 of my accounts just hit a year, 5 new oks, and a 7 dollar account decrease gave me a 17 point boost. Im pretty sure the other things triggered more of the 17 points than the 7 dollars did, but not of those trigger an update on myfico.

[renclan]

Thanks! Good advice!

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@gdale6 wrote:

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@renclan wrote:

Ok guys,

I have read so many posts on these forums about paying off all of your cards to $0 except for one. I  have worked so hard over the last month and have managed to pay all of them to $0 except for 2. I had one that has been reporting zero since last month and decided to use it for a small charge to keep it active. Imagine my dismay when I realized I missed the cutoff date for my statement and this month posted a $12 balance. The weird thing is that MyFico alert says my score increased 9 points from a balance increase of $0 >>$12. I don't get it. Why would my score go up after reporting a balance instead of 0? Does this mean that having all of those others report 0 instead of a tiny balance is going to hurt me? Thanks!

---

The best Fico scoring from revovling usage is different for everyone even including the number of cards that carry a balance. If your score was increased with 2 cards reporting then by all means let 2 cards report a small balance, you have to experiement to find your sweet spot its not uniform for everyone. The guidance of only having 1 card report a small balance does work for quite a few but not all as you have just discovered.

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[renclan]

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@NRB525 wrote:

It is part of the trending noise. Your scores are below 700, which implies you are coming back from some sort of negatives, either major or minor, in your credit file. As you continue to put more months of positive payment history in your file, and those baddies fade or drop, you will see gradual increases like this. Those gradual increases have to have some trigger event, usually reporting of a CC, so the coincidence of this new $0 to $12 was simply the trigger for that new score calculation. And I think it is probably part of a general trend of score increases over the last few months for you, correct?

I'm still not in favor of letting all cards report zero, but the larger question of the individual's credit profile and increases due to positive payments is my guess as to why the small increase with this report.

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I have one negative on my report...an old medical bill. I have a few 30 day late payments on a car from 5 years ago.  I had no credit cards until a few years ago, but have had perfect payment history since my very first card to current. I always paid early and above the minimum. I recently started paying off the balances in full and now only have the two cards with a small balance carrying over. They were 0% transfer offers I took advantage of, but the utilization is low on them. Yes, my scores have been steady rising for the past year.; significantly more in the last few months. According to Myfico alerts, a couple weeks back it alerted me that my overall credit debt lowered causing a drop in credit score. It's all very confusing!

[renclan]

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@Anonymous wrote:

And it may well not be that the increase caused the score increase. Only certain things trigger a score update, you may have had 5 cards report oks on your report, but my fico didnt update that, the balance change was simply the triggering update on the score. For example,2 of my accounts just hit a year, 5 new oks, and a 7 dollar account decrease gave me a 17 point boost. Im pretty sure the other things triggered more of the 17 points than the 7 dollars did, but not of those trigger an update on myfico.

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That makes since...I paid a lot of cards down to zero in the last month and a half, so every other day a new balance alert posts.