If I dispute a balance on a credit card that has been paid, will my FICO SCORE increase?

[Anonymous]

I paid off all my credit cards (nine of them) down to ZERO.  I HAD very high utilization which greatly impacted my credit report and FICO score.  Now that every thing is down to a zero balance my FICO score should go up in time, but I can't wait.  The credit cards that had the highest balances said they won't be reporting the information to the credit reporting bureaus until sometime in February.  What would happen to my FICO score if I sumitted a dispute online for those two credit cards and told them the balance reported in my credit report was wrong, would they stop reporting those credit cards and instantly increase my credit SCORE during the dispute process?  How long would it take the credit reporting agencies to indicate that the dispute on my credit report and not show those credit cards with the out of date balances? 

Don't tell me to be patient because a current issue requires my credit report to show those zero balances within a week.  Information please!

[llecs]

Despite your request, I suggest being patient. I can see harm in doing what you suggest.

As you may know, FICO will ignore certain aspects during a dispute like the balance and CL. Essentially your util will be 0% in the eyes of FICO assuming you don't have any other CCs, CO'd CCs, HELOCs, or LOCs that are factoring into util. Any gain from paying down util obviously varies from person to person. If util is the top negative reason within your FICO report then you stand to see some gains once the dispute is initiated. However, FICO may see that you don't have any CCs factoring into util. While the mix is not affected, I imagine there's a chance for a ding as all of your CCs are listed in the dispute. Overall I think you might see a net increase.

Here's the danger though. Even though FICO won't score the balances, it doesn't mean your credit reports will show $0. In fact they won't. It'll continue to report a balance during the dispute which could take 30-45 days, which is longer then when your statements cut next. The accounts won't disappear in a dispute. Future lenders and those looking at your reports will see the dispute comments and the balances. If you're applying for a mortgage, for example, you'll likely be denied credit for those dispute comments (if that's the issue then aim for rapid rescore via the lender...faster and safer).

Another danger is with the accounts themselves. If you had any unreported lates, then there's a high probability of lates being added when there were none before. In rare cases, disputing a balance can lead to a TL closure but it depends on your past history with them.

[JM-AM]

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@llecs wrote:

Despite your request, I suggest being patient. I can see harm in doing what you suggest.

As you may know, FICO will ignore certain aspects during a dispute like the balance and CL. Essentially your util will be 0% in the eyes of FICO assuming you don't have any other CCs, CO'd CCs, HELOCs, or LOCs that are factoring into util. Any gain from paying down util obviously varies from person to person. If util is the top negative reason within your FICO report then you stand to see some gains once the dispute is initiated. However, FICO may see that you don't have any CCs factoring into util. While the mix is not affected, I imagine there's a chance for a ding as all of your CCs are listed in the dispute. Overall I think you might see a net increase.

Here's the danger though. Even though FICO won't score the balances, it doesn't mean your credit reports will show $0. In fact they won't. It'll continue to report a balance during the dispute which could take 30-45 days, which is longer then when your statements cut next. The accounts won't disappear in a dispute. Future lenders and those looking at your reports will see the dispute comments and the balances. If you're applying for a mortgage, for example, you'll likely be denied credit for those dispute comments (if that's the issue then aim for rapid rescore via the lender...faster and safer).

Another danger is with the accounts themselves. If you had any unreported lates, then there's a high probability of lates being added when there were none before. In rare cases, disputing a balance can lead to a TL closure but it depends on your past history with them.

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+1