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Paying off credit card lowers score?

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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?

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Valued 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. 

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Message 2 of 3
Established 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
February 2020
Experian Fico 8. 683
Transunion Fico 8. 697
Equifax Fico 8. 711

Capital one QS. $600
Credit one. $300. (Soon to close )
Capital one QS1. $2250
Discover IT Cashback. $11,500
PNC cash rewards signature Visa. $12,500
Chase SW rapid rewards signature visa $6900

All cards opened between Oct 2018. - Nov 2019

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