Re-bucketed, again !

[RobertEG]

Bingo Hauling!  You put it very well.

FICO is a risk analysis.  People with different histories have different, statisticallyt proven levels of risk in repayment of debt within the next two years.  To argue against buckets is the same to me as arguing that all people must like chocolate, simple because the masses prefer it. 

I am sure that if FICO told all that it treats anyone, regardless of prior credit history, as having the same risk in repayment, then this forum would swelll with outrage!

It is mathematical prediction, pure and simple.

Would you, all other things equal, extend a loan to one who has had a recnt bankruptcy and a recent, unpaid collection account in favor of one who has a clean credit file?  I think not.

[smallfry]

I think new accounts are the number 1 score killer out there. My TU was 682 exactly 1 year ago with 56% utilization and an average age of 6 years. Now my TU stands at 717 with 15 new accounts this past year and 1% utilization. Average age is now down to 3 years.

[Anonymous]

The only problem is when playing soccer you sit on the bench because you are not so good.  FICO can stop you from buying a house or getting a loan when you are the same credit risk as you were the day before.  The longer that I pay my bills on time the better a risk I become regardless of who you compare me to.  My score should not drop simply because I am compared to a different group of people.  Example:

I am at the top of the bucket for people with BK's and one day I move buckets and my score drops.  That would mean that people in the bucket with people with BK's may have a higher score than me.  One day my score is higher than their's and the next it is lower.  Nothing changed in my creditworthiness I just changed buckets.  So the guy that I was deemed to be a better risk than the day before is now a better risk than me even though my paying habits remained constant.  This is not an accurate risk analysis.

I can certainly understand how buckets could be used to help an individual increase score but I am rather confused at the justification of it hurting a score.

[haulingthescoreup]

Well, I suppose the parallel would be that when you move to a better team, you are just as good a player as before, but the competition is tougher until you catch up. So your ranking would be lower on the new team.

I am the first to agree that the truly scary thing about re-bucketing is if it occurs just as you're getting ready to close on a mortgage. And I don't know if there's a thing in the world that can be done about that.

Looking back now at the time it took my scores to recover, I think, shoot, that wasn't bad at all. But at the time, it just killed me, and I wasn't heading for an app.

There are mortgages that aren't rigidly score-dependent, and I suppose that's what someone would have to hope for if this ever happened. Maybe bring in a wheel-barrow-ful of older printed-out reports with higher scores and no change in reports, and hope the lender can work around it.

[smallfry]

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@Anonymous wrote:

The only problem is when playing soccer you sit on the bench because you are not so good. FICO can stop you from buying a house or getting a loan when you are the same credit risk as you were the day before. The longer that I pay my bills on time the better a risk I become regardless of who you compare me to. My score should not drop simply because I am compared to a different group of people. Example:

I am at the top of the bucket for people with BK's and one day I move buckets and my score drops. That would mean that people in the bucket with people with BK's may have a higher score than me. One day my score is higher than their's and the next it is lower. Nothing changed in my creditworthiness I just changed buckets. So the guy that I was deemed to be a better risk than the day before is now a better risk than me even though my paying habits remained constant. This is not an accurate risk analysis.

I can certainly understand how buckets could be used to help an individual increase score but I am rather confused at the justification of it hurting a score.

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There is a way around this. Get involved with a top notch credit union. When you really need a loan like a mortgage or a car they look past scores much more than your Citi's or Chase's. The high limit credit cards with the so-called prime lenders are an ego stroke not much more. The credit unions will most likely be your best source down the road.

[Anonymous]

Thank you for your feedback.

My average age of accounts did indeed increase.....