Number of lines reporting a balance

[Anonymous]

Looking for clarification on a scoring issue, on FICO 8 and mortgage scores. It is my understanding, the number of lines reporting a balance has an effect on scoring, and mortgage scores are particularly sensitive. My specific issue: I have 10 revolving lines and 16 installment lines, 14 of which are student loans. (These are open accounts. Not counting closed accounts.) My thought was to consolidate my student loans, to improve the percentage of lines reporting a balance. I understand I need to AZEO my revolving lines and individual utilization on installment loans is not as much a concern as aggregate. The question is, would I improve my score by consolidating and lowering the lines reporting a balance?

[Anonymous]

AoOA- 15 yrs 8 months
AAoA - 4 yrs 9 months
AoYA- 3 months
So, I already have an account in the last year, but it will definitely affect age when things fall off. So, I'm weighing what would be the better move. I appreciate any insight that may be provided.

[SouthJamaica]

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@Anonymous wrote:
Looking for clarification on a scoring issue, on FICO 8 and mortgage scores. It is my understanding, the number of lines reporting a balance has an effect on scoring,
Agreed
and mortgage scores are particularly sensitive.
Agreed
My specific issue: I have 10 revolving lines and 16 installment lines, 14 of which are student loans. (These are open accounts. Not counting closed accounts.) My thought was to consolidate my student loans, to improve the percentage of lines reporting a balance. I understand I need to AZEO my revolving lines and individual utilization on installment loans is not as much a concern as aggregate. The question is, would I improve my score by consolidating and lowering the lines reporting a balance?

I don't know

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[Anonymous]

I ask all of this theoretically, of course. I realize there are no guarantees and every profile is different. But I was discussing this and more student loan specific issues in the student loan forum and they suggested I pose this question here before I made a mistake.

[SouthJamaica]

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@Anonymous wrote:
I ask all of this theoretically, of course. I realize there are no guarantees and every profile is different. But I was discussing this and more student loan specific issues in the student loan forum and they suggested I pose this question here before I made a mistake.

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I think it's a great question, and I wish I knew the answer. The question has been asked multiple times in this forum but, to my knowledge, has never been answered.  So if you go ahead and do it, please monitor your reports and scores carefully and come back and tell us what the answer is.

The most likely forum members to know the answer to your question are @Thomas_Thumb and @Revelate so I'm ringing them up just in case they feel like weighing in.

[Anonymous]

Thank you!

[Anonymous]

While your plan may work to improve your scores, I think it's important to try and quantify what sort of score gain you'd be looking at.  To do that, simply read on the forum and/or talk to those that have gone from a low number/percentage of accounts with a balance to a high number/percentage of accounts with a balance.  On FICO 8, you're probably talking 10-15 points max in going from a best to worst case scenario.  With mortgage scores, that number could probably be twice that, but as you already suggested every profile is different. 

[OmarR]

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@Anonymous wrote:
I ask all of this theoretically, of course. I realize there are no guarantees and every profile is different. But I was discussing this and more student loan specific issues in the student loan forum and they suggested I pose this question here before I made a mistake.

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I did this in the Winter of 2017.

I had 3 revolvers, one mortgage at 95%, and 4 lines of student loans. I paid off my student loans:

#1 - Jan 2017

#2 & #3 - Feb 2017

#4 - Mar 2017

I had no movement in any of my scores. FTR, my goal was paying off debt and not line reduction. But like you said, everyone can be different.

[Anonymous]

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@OmarR wrote:

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@Anonymous wrote:
I ask all of this theoretically, of course. I realize there are no guarantees and every profile is different. But I was discussing this and more student loan specific issues in the student loan forum and they suggested I pose this question here before I made a mistake.

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I did this in the Winter of 2017.

I had 3 revolvers, one mortgage at 95%, and 4 lines of student loans. I paid off my student loans:

#1 - Jan 2017

#2 & #3 - Feb 2017

#4 - Mar 2017

I had no movement in any of my scores. FTR, my goal was paying off debt and not line reduction. But like you said, everyone can be different.

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Wow, that's really surprising, but that's exactly why I asked. The student loan gurus over in that forum were saying I shouldn't consolidate, but I was thinking it would have a pretty decent impact on my scores, mortgage scores, at least. I definitely have more to consider now. Thank you for your input.

[Anonymous]

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@SouthJamaica wrote:

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@Anonymous wrote:
I ask all of this theoretically, of course. I realize there are no guarantees and every profile is different. But I was discussing this and more student loan specific issues in the student loan forum and they suggested I pose this question here before I made a mistake.

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I think it's a great question, and I wish I knew the answer. The question has been asked multiple times in this forum but, to my knowledge, has never been answered.  So if you go ahead and do it, please monitor your reports and scores carefully and come back and tell us what the answer is.

The most likely forum members to know the answer to your question are @Thomas_Thumb and @Revelate so I'm ringing them up just in case they feel like weighing in.

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If I do it, I will time it in a month when nothing else changes, if possible, so the point shift can be isolated. I check my scores every day, so it will be easy to see lol