Samsung Financing dropped Credit Score

[Anonymous]

I didn't do my research and I thought applying for Samsung Finance would help my credit score as long as I kept the balance paid.

It dropped my score by 39 points... is there anyway to reverse this? Pay it off, Close it? I guess those 39 points are gone now...

https://imgur.com/a/TTRtySo

[Anonymous]

Highly unlikely that adding that new account dropped your score almost 40 points. There may be something going on that cause that score drop, but when my fico sent the alert about the new account they provided you with current score. Something may have happened with your report that didn't trigger a my fico alert originally.

[Anonymous]

What you applied for is almost certainly a Consumer Finance Account (CFA).  The mere presence of a CFA hurts your score, even if you have perfect payments on them.

There are many discussions of CFAs here on the forum:

https://www.google.com/search?client=firefox-b-1&ei=49HpWqTDIZDAzgLwhqr4CA&q=consumer+finance+accoun...

I suggest you read through a few of them and you'll learn a lot more.

If you decide you want to help other people out on this thread, there's a bunch of questions I'd like to ask you.  I can't promise how much (if any) of the damage we can help you repair, but carefully watching you do the right things (as you try to fix it) in a controlled way will help us undertsand CFA impact better.

[Anonymous]

PS.  I agree with CreditAddickt that there may be something else responsible for some of that score loss.  That would be part of the reason  I'd be asking some more questions.  I have several in my hip pocket, but no point in me listing them if you'd rather not pursue this with us.

[Anonymous]

Entellex ... not of much comfort but, I applied and obtained a Wells Fargo Visa Bank Card from a Wells Fargo Financial Center Store with a $2,400 CL. Unknown to me ... I found out later that my FICO Score dumped about the same number of points as yours. Turns out the Credit Card I obtained was considered a "Consumer Finance Account." Could not figure out what was going on ... knew nothing about the affects of Consumer Finance Accounts. After learning more I knew it was on my report and I was going to have to live with the points lost until I could build up my credit report. Today the card still shows on my report but is not affecting it. Who was to know? I sure didn't. Lesson learned!

[Anonymous]

Going off of Dino's data point above, it sounds like the OP losing roughly 40 points from the addition of a CFA is completely possible.  It's worth mentioning that with a net loss of 40 points, not all 40 points are due to it being a CFA.  Just any regular old account (non-CFA) being added can sometimes drop a score say 15-25 points due to the reduction of age of accounts factors and the inquiry.  The amount of the drop though depends a lot on specific profile, where things like file thickness play a big role.  All that being said, the introduction of the CFA as a scoring factor in and of itself is likely impacting score more to the tune of 20 points. 

[Anonymous]

BrutalBodyShots points out a realistic score hit. When our credit files are in the lower FICO Scores and we are building or rebuilding it seem that the credit files are more sensitive to the many aspects of of the credit scoring system. My file was thin and had left overs from a BK drifting through it. At the time it seemed virtually any activity caused swings. The CFA was a total shock and other things were going on so the 20 points seems more on track.

[Anonymous]

@CreditGuyInDixie, sure ask as many questions as you'd like.  I am willing to share some information to help others as well as myself.

Thanks everyone for the input. I am pretty new to myFICO, so maybe I am not reading or understanding the alerts. Within a short period of time I did apply for several things... because I was excited that I improved my credit score. I didn't really see anything else that I applied for popup on my account though, just a few inquiries. I will share what I applied for very recently and what my alerts look like. As soon as I got approved for my Chase Credit Card, I went for Samsung and two cards that I've always wanted.

1. Chase Freedom Unlimited (Approved)
2. Samsung Financing (Approved)
3. Discover Card (Approved)
4. KOHLS (Approved)

Here is a screenshot of my previous Fico Alerts. It doesn't even show Chase/Discover/Kohl being added as accounts, just the Samsung; I now have both Chase/Discover cards in my wallet.

FICO ALERTS

I guess my score is going to be in a world of hurt after all I just did... Have mercy on my credit score soul...

[Appleman]

The good news is that with time and maintaining low utilization you will see the score climb back. 

You have multiple factors that are likely making your scores take a dive. 

How is your Credit Card utilization?

Thanks for sharing, it will take time, low reported utilization and a continued perfect payment history to see the score climb back.

[Anonymous]

I also have 3 older cards I don't really use.

I only have about $80 on my Chase and still the 300 balance on that samsung financing account