Question about "Simulate Best Action"

[Anonymous]

The fico "Best Action Simulator" states if I pay off 90% of my debt over a 24 month period I can expect a score range for 764-804.  But, when I tired another simulator and to pay off 90% of the debt (at one time) the range is only 724-764.

Any guesses why?

My score now is 684 because I have a high (57% util).  I just sent in payments to pay off half my debt but now I'm wondering if I should pay the rest off over the long haul?

My oldest card is a 22 year old Sears cad and my average history age is 8 years.

TIA!

[MidnightVoice]

I have found the MyFICO simulator tends to overestimate and give you better news than reality.  It also seems to ignore every other aspect of the report other than the one it is simulating. 

For me, in terms of paying bills on time for a year, it predicted about 3 times the increase I actually got.

So If high itilization is the ONLY blemish on your CR, and if you don't look for credit in the next two years, and don't close any cards and don't get any new blemishes, you might get the bottom end of what it estimates. 

Others may disagree.   Stay tuned. 

As to why, it is because they use different formulae.  Which is not very helpful, I know, bur reflects reality 

[Anonymous]

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@Anonymous wrote:

The fico "Best Action Simulator" states if I pay off 90% of my debt over a 24 month period I can expect a score range for 764-804. But, when I tired another simulator and to pay off 90% of the debt (at one time) the range is only 724-764.

Any guesses why?

My score now is 684 because I have a high (57% util). I just sent in payments to pay off half my debt but now I'm wondering if I should pay the rest off over the long haul?

My oldest card is a 22 year old Sears cad and my average history age is 8 years.

TIA!

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Assuming no accounts are added or closed, the 24-month simulation will also include the history benefits - your oldest (and youngest) accounts will be two years older, and your average account age will increase from 8 to 10 years. All of those factors contribute to the score increase, and are not included in the second simulation.

I would pay off your debt as quickly as you are able for the FICO benefit of lowered utilization and the wallet benefit of minimized finance charges ...

[MidnightVoice]

And....the most financially sensible and cheapest way to deal with the CC debt is to pay it off.  In one sense, the score does not matter.  Paying off the debt won't hurt the score, will help you financially and the score will be what it is. 

[Tuscani]

I also agree that the sim overestimates.. Don't rely on it as being 100% accurate.

[Anonymous]

Thanks for the info.  The balance is on a 0% interest BT for life and I won't use that card for any new charges as long as that's on there.  

The balance is left over debt that's been slowly getting paid off from putting my son through Ga. Tech.  He actually has a great job now and gave me the money to pay it all off.   (I thought I'd pay half and stick the other half away in a Roth account unless it made a huge difference in my credit rating.)

And no, not looking for new credit.  Just want to have my ducks in a row should I need it in the future.

[Anonymous]

I go only by the first number not the range. 700-730. I only expect around 700. But 2 years is too far to guess any score. I only go a head as far as 30 days for any accuracy. And still that has yet to be definite.