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Higher Score with longer repayment

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Re: Higher Score with longer repayment

You're talking about a 15 point difference from a "black box estimator".  Does that point difference really matter?  Think about the money you're throwing away in interest cost.  That's what matters. 

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Message 11 of 16
Valued Contributor

Re: Higher Score with longer repayment


@core wrote:

@Thexy1 wrote:
I guess I'm confused because I think that payment history+age+/-whatever other factors=points. Am example would be that I would get more points for making payments for 5 months than paying a lum sum payment.

No, it makes no difference.  You can pay your balances over 12 months (and pay interest), or pay them all off tomorrow and just let your accounts age for 12 months and your score will be exactly the same in either case.  FICO has no memory of past balances; all that matters is what balances are shown at any given moment.


Now that you know it's based on time and timely payments (i.e. no late payments during that time), did you enter various months between 12 & 24? I ask, because when I used the simulator, it showed that I would reach the 24 month score in 18 months. Actually, it showed that my score would increase at 3 mos, 6 mos, 12 mos and 18 mos.

 

I'm too frugal to pay every month, so I used the simulator and noted the months that it would change. Month 3 will be on 4/28/15, but I think I'll pull my score again at 6 months which will be 7/28/15.

Original Mortgage maturity Sept 2044; Refi maturity Dec 2030
Starting Score: EX 751 EQ 720 TU 737 on 4/9/14
Current Score: EX 849 EQ 835 TU 843
Goal Score: 850


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Message 12 of 16
Super Contributor

Re: Higher Score with longer repayment


@core wrote:

@Thexy1 wrote:
I guess I'm confused because I think that payment history+age+/-whatever other factors=points. Am example would be that I would get more points for making payments for 5 months than paying a lum sum payment.

No, it makes no difference.  You can pay your balances over 12 months (and pay interest), or pay them all off tomorrow and just let your accounts age for 12 months and your score will be exactly the same in either case.  FICO has no memory of past balances; all that matters is what balances are shown at any given moment.


+1

OP, you are confusing the score simulator. Pay your interest bearing balances off as fast as you can. Your revolving accounts will be there, and you can use them for PIF purchases after they are zeroed. After the 24 months, you likely will be at the same place as the 24 month simulator says, and even better, you will not have paid more interest than you have to.

 

Your score does not care if you are paying on a balance, it cares that you have another good month with no lates.

High Bal Jan 2009 $116k on $146k limits 80% Util.
Oct 2014 $46k on $127k 36% util EQ 722 TU 727 EX 727
April 2018 $18k on $344k 5% util EQ 806 TU 810 EX 812
Jan 2019 $7.6k on $360k EQ 832 TU 839 EX 831
Message 13 of 16
Highlighted
Established Member

Re: Higher Score with longer repayment

@NRB525 Thanks .. so no lates is the increasing factor not monthly payments. Thanks all for your help.

Message 14 of 16
Established Member

Re: Higher Score with longer repayment

@bdhu2001 I just did 12 and 24 to note the difference but I will definitely go back and run the numbers for the different number of months. 

 

I forgot about total interest over time and I would rather save on interest. 

Message 15 of 16
Established Member

Re: Higher Score with longer repayment

@cluessJohn My original question/statement was does 15points even really matter which is why I wanted feedback.

Message 16 of 16
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