Rebucketing

[RobertEG]

OK  Here is the plan to know if you have been rebucketed.

You need 14 Green Berets, clad in olive greenm with FICO vision goggles, and a strike-force team from a Ton Clancy novel.

FICO algorithms are a corporate trade secret held at FairIsaac.

Your mission, if you should choose to accept is...........futile!

[haulingthescoreup]

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@Anonymous wrote:
can you give me a quick blurb on how you KNOW you are rebucketed? thanks, Dave.

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If you have Scorewatch from myFICO (not sure that the version from EQ will do this), one happy day you might get an alert like this below. There is the usual yada yada, but I've bolded the section that speaks to re-bucketing. It's at the end. None of the other stuff had happened, or I should say that it had already happened and didn't happen again, so it was pretty obvious which factor it was. My longest history had just jumped from 11 years (I think) to 18 by going AU on DH's Discover card, something I'm now considering dropping.

And BTW, re-bucketing can increase your score, so it's not always an initial hurt:

Score Watch alert
October 15, 2007


Alert: Your FICO® score has dropped below your target score of 651


Score Watch alert/Changes to your FICO® Score
Your FICO® score decreased to 636 on October 15, 2007.
Target score alert: Your FICO® score has dropped past your target score of 651.
Interest rate alert: Your new score of 636 may qualify you for a new interest rate of .

This score decrease may be caused by these 3 new reasons:

* You have a serious delinquency (60 days past due or greater) or a derogatory description on your credit report.
* You have multiple accounts showing missed payments or derogatory descriptions.
* You’ve recently missed a payment or the date of your most recent payment is unknown.


Changes to your credit report

Your FICO® score went down on a day when there were no credit alerts on your Equifax Credit Report™. This can happen if:

* There was a change on your credit report that lowered your score but did not trigger an alert. For example, the balance on an account might have increased enough to lower your score, but not enough to trigger a balance increase alert.

* You moved from one category of credit users to another as time passed. For example, you may have transitioned from the category "consumers with a new credit history" to the category "consumers with a two- to five-year credit history". As a result, your credit report is evaluated differently, causing a slight change in your score. The good news is that moving between categories like this usually offers you the potential to reach a higher FICO® score in the future.

If you don't have Score Watch, or if it was in one of its occasional comas, you have to deduce a re-bucketing. If you very last collection or your very last public record drops off (or appears), you will be assigned to a new bucket. Also, when your oldest history moves over some break points mentioned in an earlier post: under 2 years, 2 years - 4 years 11 months, 5 years to maybe 12(?), 12 years to 18 years 11 months, 19 years or longer. (There's debate about whether there's another stage between 5 years and 12 years. And here it gets really fuzzy: I think that each of these age categories can include with or without a serious derog, but I really don't know.

[Anonymous]

That is an excellent post hauling. The fact that there are 8 positive buckets and 2 negative (non-FICO '08 models) I believe implies that there are not separate serious derog buckets for long negative history as I would think those would be called "negative buckets."

Just a theory but here is what is in play.

If indeed there are buckets broken down roughly:

0-2

2-5

5-12

12-19

19+

I also assume there is a "many new accounts" bucket for people with no derogs.

That leaves 2 positive buckets unaccounted for. I infer the 19+ bucket is rather large, as we have posters with 23+ years of history being dinged for low age in their comments. That said there is no indication there isn't another bucket say at 27-30 years. If anyone has a SW alert that makes you think you were rebucketed and you simply aged to 27 years + of history please chime in. I thus believe, the only other bucket that would make sense is one between the 5 and 12 category.

Buckets only make sense in risk modeling if they increase your ability to predict the likelihood of a major late payment or loan default. I think the higher you go in total history the less additional predictive power you add. Is someone who has 40 years of history less likely to default than 30....probably not by very much - but there is likely much more of a spread between someone with 5 years of history and someone with 12, so I believe that is where it makes the most sense to have a separate bucket.

I assume that people with 30 and 60 day lates stay in the positive buckets and that the negative buckets are broken down:

90+ lates, collections

public records, bankruptcy

That would add up to the 10 buckets. Those are all semi-educated guesses, based on what I have read on this forum. I could be way off, but unless FICO comes out and declares them who knows.

[Anonymous]

This stuff is fascinating!

What happens if someone falls into more than one bucket?  Maybe they only use the "number of years" buckets for people who don't have any derogs OR too many inqs OR too high of a util%.  My guess is that you probably get stuck with the most derogatory bucket you fall into.  Like no derogs, but too many new inqs.

[Anonymous]

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Phoenix-rising wrote:

This stuff is fascinating!

What happens if someone falls into more than one bucket?  Maybe they only use the "number of years" buckets for people who don't have any derogs OR too many inqs OR too high of a util%.  My guess is that you probably get stuck with the most derogatory bucket you fall into.  Like no derogs, but too many new inqs.

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You can only be in one bucket at a time.  From what we have pieced together, it appears that if you have derogs at all, you fall into one of the two "derog" buckets, depending on the nature of the derogs.  If you have a clean report, then you fall into a bucket according to your length of credit.  So there is really no way you can meet the criteria for two different buckets at the same time anyway.

Keep in mind this is just from the information we've been able to piece together, and is not official word on the matter at all.

Actually, I need to give credit to those who have pieced this information together, since I am generally useless when it comes to questions of buckets and mangos.

[haulingthescoreup]

Great posts from everyone!

Here's why I get vague about which trumps which (serious derog or length): I was definitely re-bucketed for length of history last October, as posted above, and I'm pretty sure that I was re-bucketed in June when that account turned 19. I started having all sorts of brand new and bizarre positive and negative comments on my FICO score reports.

BUT I have a serious derog: a 90-day from Feb 2007. So I'm thinking that there are buckets for length of history, two for each length, one with clean reports and one serious lates. But then that screws up the total number of accounts that debtisgood analyzed so well, so maybe not. Maybe it's only length of history, plus public records and collections, and serious derogs that aren't public records or collections just hurt your score.

And if I've just duplicated what someone else just posted, my apologies. I seem to have chipmunks squeaking in my brain today. Time for a beer, I think.


edit to add: Here's a positive comment from TU that I have never, ever gotten before. Sort of a half-hearted "Well, you don't stink as much as you might." Maybe there are double buckets (with and without serious lates) just for longer histories?!?!?

You have no public records or collections on your credit report.

Number of public records on your credit report
0 Records
Virtually no FICO High Achievers [?] have a public record listed on their credit report.
Number of collections on your credit report
0 Collections
Virtually no FICO High Achievers [?] have a collection listed on their credit report.

The fact that you have no public records [?] or collections on your credit report is a good thing. The presence of a public record (such as a bankruptcy or tax lien) or a collection [?] is a powerful predictor of future payment risk - people with these items on their credit report are much more likely to miss future payments than those without them.

Never seen this one before!

Message Edited by haulingthescoreup on 07-04-2008 01:22 PM

[Anonymous]

cheddar wrote:

You can only be in one bucket at a time.  From what we have pieced together, it appears that if you have derogs at all, you fall into one of the two "derog" buckets, depending on the nature of the derogs.  If you have a clean report, then you fall into a bucket according to your length of credit.  So there is really no way you can meet the criteria for two different buckets at the same time anyway.

So if I have a CC opened 22 yrs ago and I have no derogs I'm probably in the 19+ bucket?  Is that like a double edged sword?  Higher standards to be met and anything negative (new accounts, high util) hurts more?

[Anonymous]

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Phoenix-rising wrote:

cheddar wrote:

You can only be in one bucket at a time.  From what we have pieced together, it appears that if you have derogs at all, you fall into one of the two "derog" buckets, depending on the nature of the derogs.  If you have a clean report, then you fall into a bucket according to your length of credit.  So there is really no way you can meet the criteria for two different buckets at the same time anyway.

So if I have a CC opened 22 yrs ago and I have no derogs I'm probably in the 19+ bucket?  Is that like a double edged sword?  Higher standards to be met and anything negative (new accounts, high util) hurts more?

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Yep, that sounds right.  Yes, it is sort of a double-edged sword.  You can think of it in terms of reversion to the mean.  If you are in the 19+ bucket, you have the potential for very high scores, but one little mistake can smack you pretty hard because the standards are much higher in that exclusive little club.

It's similar to the reason that it's actually not that difficult to get from the high-500s to the mid-600s.  Because of this tendency to revert to the mean, when you're well below the mean, every little bit of positive behavior helps a great deal.  By the same token, once you get into the stratosphere, it's more difficult to stay there.