Re: HUGE score drop from new card

RonM21 · ‎05-04-2016

@Anonymous wrote:
If I understand you got a Slate with a $3000 limit and transferred $3000 to it? If that's the case and you haven't paid it down yet it could because that card is 'maxed out'.

This could be part of the issue. I'm interested to see what you find your scores to be, once getting them from somewhere else. Where are you going to get them from?

Total CL: $321.7k

UTL: 2%

AAoA: 7.0yrs

Baddies: 0

Other: Lease, Loan, *No Mortgage, All Inq's from Jun '20 Car Shopping

woozy · ‎05-04-2016

Sooo...if I took my $3000. balance off of a $12,000. limit card, and left the $12,000. card with a $0 balance, that could crater my score 60 points? WHUT??!!

I checked all 3 credit reports, and my EQ (only) is still showing the same balance on both cards. However, all scores are down, pretty much equally. Is there *bleed* between the CRA's?

I'll get my scores here, but I think score is pretty much moot now, because something weird is definitely going on, and I have to figure out all the factors to fix it. I was happy to decrease my utilization. Silly me!

Thanks for the clues, you guys are awesome.

sr383 · ‎05-04-2016

@woozy wrote:
Sooo...if I took my $3000. balance off of a $12,000. limit card, and left the $12,000. card with a $0 balance, that could crater my score 60 points? WHUT??!!

Shifting $3,000 from one maxed out card with a high rate is probably better than bringing the $12,000 card to zero.

In the first scenario, only one card is maxed out, but you're paying less interest (or no interest). In the second scenario, two cards are maxed out.

woozy · ‎05-04-2016

OK. Let my peabrain try to get this straight.

Cap1-I'm using this card, balance is $2500. I intended on using only this card for right now.

US Bank-Balance is $0. I transferred the 3000. balance to the no-interest Slate. I intended to keep this card at a very low, or no, balance.

Slate- They gave me $3000. I transferred the US Bank balance here.

Do I need to ask Slate for a $1000. CLI so the card isn't maxed out?

Should I use the US Bank so it doesn't show zero balance? Any suggestions for the utilization I'm aiming for?

What else can I do to correct this undeserved punishment?

Anonymous · ‎05-04-2016

I have to start with the caveat that I don't know everything in your credit profile, but if the balance transfer is the only major thing that's changed - no other new accounts, derogs, etc, then I would assume this -

You have 3 cards - you said with overall 30% uti.

Cap 1: 2500 / ?? - at least 4k, so 62% or less uti

US Bank: 0/12000 - 0 uti

Slate: 3000/3000 - 100% uti

Utilization factors both the overall uti (30%) and the uti of individual cards.

You have one that's maxed out - that causes a score drop because normally a maxed card could indicate inability to pay.

Now in your case that's not it - you know it, Chase I assume, knows it, but the scoring algorithm can't tell the difference (as far as we know

You are saving interest fees and that makes fiscal sense. It does seem unfair that you get penalized but you'll recover - it's temporary, unlike getting a collection/chargeoff and being stuck with the damage for years.

Once you start paying down the Slate you'll see your score rise. Get all your cards below 50,30%,20% uti and you'll recover more.

Utilization has no 'memory' - if you paid off the 3k right now you would probably recover most of your points - not all because you have the inquiry & new account affecting it too.

There's a lot of info on the boards and on the site that'll help shed a little light on the mystery that is FICO.

see these pages for a start:

http://www.myfico.com/CreditEducation/Amounts-Owed.aspx

http://www.myfico.com/crediteducation/questions/credit_problem_comparison.aspx

Hope this helps.

woozy · ‎05-05-2016

Everything is reporting correctly. My FICO scores are down ~60, across the board. TL/DR is that I decreased utilization. balances are static, dings on credit are zero, and I have caused myself a big problem from getting the "free" credit.

I'm getting an Office/Warehouse lease right now, and this is going to cause me to have to make a deposit, which I had talked the guy out of due to my high score. This is a big deal, since this takes money out of my pocket for no benefit to me for several years. I can't afford the loss of that cash right now. Waiting and correcting this is not an option.

I also look like a liar, since NOBODY with a brain is going to believe that I lost 60 points from just getting a new $3000.00 credit card. Haha, April Fool. I saved a few dollars of interest and its going to cost me $1000.00.

Anonymous · ‎05-05-2016

@woozy wrote:
Everything is reporting correctly. My FICO scores are down ~60, across the board. TL/DR is that I decreased utilization. balances are static, dings on credit are zero, and I have caused myself a big problem from getting the "free" credit.

I'm getting an Office/Warehouse lease right now, and this is going to cause me to have to make a deposit, which I had talked the guy out of due to my high score. This is a big deal, since this takes money out of my pocket for no benefit to me for several years. I can't afford the loss of that cash right now. Waiting and correcting this is not an option.

I also look like a liar, since NOBODY with a brain is going to believe that I lost 60 points from just getting a new $3000.00 credit card. Haha, April Fool. I saved a few dollars of interest and its going to cost me $1000.00.

If you need the lease right now, then you're right. The score drop torpedoed your plan.

For the future, the best way to maximize your score when you have something important coming up that will check it is as follows:

1.) don't apply for any additional credit for a year before the important loan/lease/etc. If that's not possible, the more time between your most recent inquiry or new account and your application for the important loan/lease/etc., the better.

2.) in the month or 2 preceeding your application for the important loan/lease/etc., you want to ideally show 10% or lower utilization reporting on all your cards, with half your cards or more showing zero and the rest below 10%. If that isn't possible, your highest reporting balance should be on the card with your highest available credit limit, which will show the lowest utilization.

Anonymous · ‎05-06-2016

If I'm reading it right the slate with 100% UTI is what's causing it. When I did the no interest on some furniture once my score dipped. Put 2200 on a 3000 card. Once I paid it down to 900 score rebounded. Even tho my overall UTI is 5% or lower across all cards.

SouthJamaica · ‎05-07-2016

@woozy wrote:
Sooo...if I took my $3000. balance off of a $12,000. limit card, and left the $12,000. card with a $0 balance, that could crater my score 60 points? WHUT??!!

I checked all 3 credit reports, and my EQ (only) is still showing the same balance on both cards. However, all scores are down, pretty much equally. Is there *bleed* between the CRA's?

I'll get my scores here, but I think score is pretty much moot now, because something weird is definitely going on, and I have to figure out all the factors to fix it. I was happy to decrease my utilization. Silly me!

Thanks for the clues, you guys are awesome.

No one can answer your question unless you tell us your (a) limits and (b) balances.