Frustrated with my credit scores

[Anonymous]

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@Anonymous wrote:

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@Anonymous wrote:

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While I understand what you are saying, in practice it simply does not work that way. When I took oput the car loan (December 2015)  I took a 15 point hit for the new account. I got back 2-3 points a month as payments were made and the balance went down. All the points I got while making the payments were lost when I paid the debt off completely. Paid the loan off and took a 40 point hit. FICO exists to keep you in debt. Get out of Debt and you get thrown off the ride. That was my experience. $5 debt = good. $0 debt = bad.

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Two things here. 

One, with your $5 "debt" and $0 debt.  $5 does not need to be "debt" it's a reported balance.  You do not have to pay interest on it.  It's not "real" debt.  So the FICO points you are getting with respect to optimal revolving utilization is obtained are done so without any debt at all. 

Two, there's an inconsistency somewhere in what you are saying regarding your car loan.  When you opened the car loan, did you already have an existing open installment loan or was it your only one?  Taking a 15 point hit for the new account is fine and all and usually those points will come back quickly; in my experience 4-6 months.  After that, assuming this was your only installment loan, your score should have continued to rise above what your starting point was.  By the time you got to very low utilization on the car loan just prior to paying it off, typically your score would be 25-30 points higher than your starting point.  Of course, that's all other things being equal and obviously over the course of the life of an auto loan the chances of all things remaining equal are slim to none as there are constant changes going on to everyone's credit profile.  If you had another installment loan present when you took out the car loan in 2015, you were already satisfying the "credit mix' sector of the pie with the first installment loan, so there would be no added benefit (only drawback) to adding another loan as it would increase your installment loan utilization in addition to the hit you took from the new account/inquiry/potential AAoA drop.

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YES!!

[Anonymous]

As I said, I bit the bullet and am trying to get both a SSL and a secured credit card from my Credit Union. The FICO score they pulled from EXP was 644 a full 56 points higher than what FICO itself is giving me, so apparently they are using a different model. It is also telling that the inquiry did not cost me any points.

[Anonymous]

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@Anonymous wrote:

As I said, I bit the bullet and am trying to get both a SSL and a secured credit card from my Credit Union. The FICO score they pulled from EXP was 644 a full 56 points higher than what FICO itself is giving me, so apparently they are using a different model. It is also telling that the inquiry did not cost me any points.

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Soft pull! Yay! Hopefully you start to see some movement in a positive direction soon.

[Anonymous]

As far as the SS loan goes, you'll want a loan where all of the following is true:

(1) Term of the loan is 60 months

(2) Lender permits you to pay off almost all of it in the first month and yet still keep it open for the full 60 months

(3) Soft pull rather than a hard pull

Alliant meets all those conditions but there may be other lenders that do as well.

You will get almost no benefit from the technique unless you pay your loan down to < 9% and keep it open for the full life of the loan.

A very useful thing for anyone executing the technique is to read the writeup we have here (first two posts of a thread) so that it's clear how it works, what scoring models it helps with, etc.