Showing results for 
Search instead for 
Did you mean: 

Paying off credit card lowers score?

New Visitor

Paying off credit card lowers score?

I have a credit card from a credit union, that I make occasional purchases on and either pay off in the same month or within a couple of months.  Whenever I make a purchase on the card, my credit score goes up.  When I make a payment or payoff the balance my credit score goes down.  This seems like it is operating opposite to what I'd expect.  Why is this happening?

Message 1 of 3
Senior Contributor

Re: Paying off credit card lowers score?

Hi  jfullert, Welcome to the forums! 


Is this your only revolving credit account?  If so, allowing it to report a $0 balance will cause your FICO scores to drop as you are penalized for having 'no revolving credit usage'.   At least one of your cards must report a balance -- but not too high of a balance -- to prevent this penalty.  Once your card reports a balance again, you'll regain your lost points. 

Personal Aphorism:
"Forget What You Feel, Remember What You Deserve"

Starting FICO 8s | 09/2017: EX 641 ✦ EQ 634 ✦ TU 647
Current FICO 8s | 11/2020: EX 780 ✦ EQ 771 ✦ TU 781
Current FICO 9s | 11/2020: EX 793 ✦ EQ 780 ✦ TU 778
2020 Goal Score | 800s

My AAoA: 3.8 years not incl. AU / 4 years incl. AU
My AoOA: 7.10 years not incl. AU / 9.10 years incl. AU
Inquiries: EX 0/6 | 1/12 ✦ EQ 1/6 | 2/12 ✦ TU 0/6 | 1/12
Report Status: Clean

Without patience, we will learn less in life. We will see less. We will feel less. We will hear less. Ironically, rush and more usually mean less.
Message 2 of 3
Valued Contributor

Re: Paying off credit card lowers score?

Yes reporting a zero balance will lower score if it's your only card. I get my balance down to less than 8% on one card then PIF when statement cuts. My other two report zero. It seems to satisfy fico
July 2020
Experian Fico 8. 707
Transunion Fico 8. 705
Equifax Fico 8. 724

Capital one QS1. $2450
Discover IT Cashback. $12,000
PNC cash rewards signature Visa. $17,500
Chase SW rapid rewards signature visa $6900
Amex Green Card NPSL POT $11,000

Amex Hilton Honors $1000
Citi Rewards $3900
Message 3 of 3
Advertiser Disclosure: The offers that appear on this site are from third party advertisers from whom FICO receives compensation.