Refinancing soon -- FICO score question

[Anonymous]

Ok so I'm brand new to myFICO -- has very useful information from what I can tell.  But my scores (especially my mortgage scores) were a little lower than I expected.  So I had some questions, but before I ask -- I realize my scores are still very good, but just want to verify some things before I start the refinancing process.

All those free credit-card scores were showing in 825-835 range, but on myFico it is showing (for the Mortgage scores) 796 Eqifax, 788 TransUnion, and 808 Experian.  They categorize them as "very good, very good, exceptional" -- do I need to get the "very goods" into the "exceptional" to get the best mortgage rate, or are these good enough?

If I do need to get them to exceptional (I'm assuming that's 800), is there anything I can do to quickly bump at least the 796 up into 800 range?  The factors it lists on my report are as follows:

• You opened a new credit account recently
  • I did open a personal loan in 11/2020 for $10,000 for home repairs, I have under $3,000 left on the loan.  Should I wait until after 11/2021 to apply for refinance?
• You have too many credit accounts with balances
  • I have a mortgage, personal loan (above), and that's it -- I pay off my CC's immediately after charging.  Why too many balances?
• You have a consumer finance account on your credit report
  • I think this is the personal loan from above.  Should I just pay this off?
• You have a short credit history
  • I opened a a few credit cards in the past 2 years.  Should I close some of these to get my average years back up?
• You have not established a long revolving and/or open-ended account credit history
  • Not sure why it says this, I have a CC's from 2005, 2008, and then 3 recent (2019, 2019, 2020).

Let me know if you need more information.  Any help would be great, thanks.

[dragontears]

---

@Anonymous wrote:

Ok so I'm brand new to myFICO -- has very useful information from what I can tell.  But my scores (especially my mortgage scores) were a little lower than I expected.  So I had some questions, but before I ask -- I realize my scores are still very good, but just want to verify some things before I start the refinancing process.

All those free credit-card scores were showing in 825-835 range, but on myFico it is showing (for the Mortgage scores) 796 Eqifax, 788 TransUnion, and 808 Experian.  They categorize them as "very good, very good, exceptional" -- do I need to get the "very goods" into the "exceptional" to get the best mortgage rate, or are these good enough?

If I do need to get them to exceptional (I'm assuming that's 800), is there anything I can do to quickly bump at least the 796 up into 800 range?  The factors it lists on my report are as follows:

• You opened a new credit account recently
  • I did open a personal loan in 11/2020 for $10,000 for home repairs, I have under $3,000 left on the loan.  Should I wait until after 11/2021 to apply for refinance?
• You have too many credit accounts with balances
  • I have a mortgage, personal loan (above), and that's it -- I pay off my CC's immediately after charging.  Why too many balances?
• You have a consumer finance account on your credit report
  • I think this is the personal loan from above.  Should I just pay this off?
• You have a short credit history
  • I opened a a few credit cards in the past 2 years.  Should I close some of these to get my average years back up?
• You have not established a long revolving and/or open-ended account credit history
  • Not sure why it says this, I have a CC's from 2005, 2008, and then 3 recent (2019, 2019, 2020).

Let me know if you need more information.  Any help would be great, thanks.

---

@Anonymous 

If those are your mortgage scores then you are fine to move forward with your refinance. Mortgage interest rate tiers typically top out at 760 middle score so increasing your score will not get you a lower rate.

[SouthJamaica]

---

@Anonymous wrote:

Ok so I'm brand new to myFICO -- has very useful information from what I can tell.  But my scores (especially my mortgage scores) were a little lower than I expected.  So I had some questions, but before I ask -- I realize my scores are still very good, but just want to verify some things before I start the refinancing process.

All those free credit-card scores were showing in 825-835 range, but on myFico it is showing (for the Mortgage scores) 796 Eqifax, 788 TransUnion, and 808 Experian.  They categorize them as "very good, very good, exceptional" -- do I need to get the "very goods" into the "exceptional" to get the best mortgage rate, or are these good enough?

If I do need to get them to exceptional (I'm assuming that's 800), is there anything I can do to quickly bump at least the 796 up into 800 range?  The factors it lists on my report are as follows:

• You opened a new credit account recently
  • I did open a personal loan in 11/2020 for $10,000 for home repairs, I have under $3,000 left on the loan.  Should I wait until after 11/2021 to apply for refinance?
• You have too many credit accounts with balances
  • I have a mortgage, personal loan (above), and that's it -- I pay off my CC's immediately after charging.  Why too many balances?
• You have a consumer finance account on your credit report
  • I think this is the personal loan from above.  Should I just pay this off?
• You have a short credit history
  • I opened a a few credit cards in the past 2 years.  Should I close some of these to get my average years back up?
• You have not established a long revolving and/or open-ended account credit history
  • Not sure why it says this, I have a CC's from 2005, 2008, and then 3 recent (2019, 2019, 2020).

Let me know if you need more information.  Any help would be great, thanks.

---

Welcome to the MyFICO Forums.

1. Yes your mortgage scores are good enough to get the best mortgage rates.

2. No need to wait to apply for refinance.  But if you were to wait until December it's possible you could pick up a few points.

3. You don't have too many balances. In fact you could be losing a few points by paying off revolvers before statement cut. It's best to let one of your revolvers report a small statement balance before you pay it off, while the others report zero balance.

4. If you pay off the personal loan it's possible you could pick up a few points.

5. Closing cards doesn't help your AAoA; closed cards count too. So no you shouldn't close anything.

Bottom line: I agree with @dragontears  that you should move ahead with the refinance.

[Anonymous]

---

@Anonymous wrote:

Ok so I'm brand new to myFICO -- has very useful information from what I can tell.  But my scores (especially my mortgage scores) were a little lower than I expected.  So I had some questions, but before I ask -- I realize my scores are still very good, but just want to verify some things before I start the refinancing process.

All those free credit-card scores were showing in 825-835 range, but on myFico it is showing (for the Mortgage scores) 796 Eqifax, 788 TransUnion, and 808 Experian.  They categorize them as "very good, very good, exceptional" -- do I need to get the "very goods" into the "exceptional" to get the best mortgage rate, or are these good enough?

These are good enough. 760+ is a high enough score to qualify you for top rates in 99% of scenarios.

If I do need to get them to exceptional (I'm assuming that's 800), is there anything I can do to quickly bump at least the 796 up into 800 range?  The factors it lists on my report are as follows: Quickly? No, your scores will see the most improvement from allowing accounts to age.

• You opened a new credit account recently
  • I did open a personal loan in 11/2020 for $10,000 for home repairs, I have under $3,000 left on the loan.  Should I wait until after 11/2021 to apply for refinance? I would apply now, you aren't going to see any significant changes in your approval by waiting.
• You have too many credit accounts with balances
  • I have a mortgage, personal loan (above), and that's it -- I pay off my CC's immediately after charging.  Why too many balances? I would make sure that your other accounts are reporting zero, it is possible you could have a statement cut after making a purchase and before the payment posts. As @SouthJamaica mentioned, for optimal scores you should let one cc account report a small balance.
• You have a consumer finance account on your credit report
  • I think this is the personal loan from above.  Should I just pay this off? This will not eliminate the consumer finance account reacon code. This will remain for as long as the CFA loan remains on your profile, whether it is open or closed. In most cases loans will continue to report for 10 years after they are paid off. You could gain some points from having less accounts with a balance and it would improve your DTI during the underwriting process, but I don't believe either of those factors will make much of an impact on your approval.
• You have a short credit history
  • I opened a a few credit cards in the past 2 years.  Should I close some of these to get my average years back up? No. Closing accounts will not increase your average age of accounts as closed accounts are included in aging calculations. If I remember correctly, this negative reason code actually indicates the age of your oldest account is not old enough. The only way to "fix this" is to let accounts age.
• You have not established a long revolving and/or open-ended account credit history
  • Not sure why it says this, I have a CC's from 2005, 2008, and then 3 recent (2019, 2019, 2020).

Let me know if you need more information.  Any help would be great, thanks.

---

[Anonymous]

Wow thanks for the great detailed responses!  Makes much more sense now.   I'll go ahead and move forward with refinance.