Score Continuing to Drop Despite Paying Off Debt!!! (Update Score Going Up!!!)

[MattieNumNums]

My score has dropped almost 50 points this month and I am extremely discouraged. I have paid off all my collections accounts and have received 2 new credit cards. My score went up and than just dropped for no reason at all by 40 points and than when my new credit card hit my report it dropped another 10 points. I have no clue what to do anymore. I was in better shape when I was a dead beat.

*** Update Please read the thread. My expirieince has been getting much better ***

[haulingthescoreup]

You're pulling a FICO score from here, right?

What were the negatives listed on screen 2 before, and what are they now?

[MattieNumNums]

That was from here.

The negatives haven't changed.

The only thing that has changed has been me receiving a new Credit Card but the score was dropping before than.

Another crazy thing, I paid for my Transunion score here and its a 592. A lot closer to the 599 I was at when this freefall started.

[Anonymous]

It's really really hard to know what's going on without seeing your reports and what's on them.

A new account often dings folks a few points but they seem to regain them within a few months, so that one is kinda predictable.

The drop is possibly rebucketing or sometimes a change on your report that is difficult to decipher.  If possible, have someone look at your report and help you figure out what has changed.  IME, A second set of eyes is alway helpful.

Sometimes you can see a rebucketing effect by looking at the simulator.  Your new best action may give you a higher score than you had access to before - so a temporary drop is easier to handle when you see the light at the end of the tunnel.

I've been though some significant rebuilding and would be upset if I didn't understand why a significant drop had occurred on my reports as well. 

My best advice is to hang in there, because following the FICO mantra (pay on time, low utilization, no new accounts, clean up baddies) seems to work very very well for increasing FICO scores in the long run.  Don't give in to frustration - keep on keepin' on.

[llecs]

And know, OP, that paying a collection will never help your FICO for as long as it reports.

I'd expect a drop due to the new accounts being added, but 50 does seem steep. Did utilization increase once they reported?

[MattieNumNums]

My damn score dropped again today. I called MyFICO and they were NOT helpful at all. I disputed 3 accounts showing up as delinquent and they were updated to paid. My score has dropped almost 60 points in 1 1/2 months and all of my negative reports minus 2 are paid and in good standing. The credit system is a joke and a fraud. I've done everything I can and my score keeps going down and I get NO answers. All I get it the same recanned bull answer of well scores change. No crap someone tell me right now why my score has gone down when things are paid. I'm so frustrated. I've spent close to 10 grand getting out of debt and I was in better shape before I started this worthless journey. I kept telling the phone rep that this is only happening on Experian and that my Transunion is fine but she continued to ignore me.

[MattieNumNums]

I also, cancelled my MYFICO account. The customer service everytime I have called has been terrible. I get no anwers from anyone. Someone in this vast universe must have an answer as to why paying off bills and being in good standing = lower credit scores than when I was a dead beat who didn't pay anything.

[llecs]

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@MattieNumNums wrote:

I kept telling the phone rep that this is only happening on Experian and that my Transunion is fine but she continued to ignore me.

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Was this on Experian? You can't access your Experian report on this website.

Per the score drop, disputing accounts can drop your score.

[MarineVietVet]

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@MattieNumNums wrote:

My damn score dropped again today. I called MyFICO and they were NOT helpful at all. I disputed 3 accounts showing up as delinquent and they were updated to paid. My score has dropped almost 60 points in 1 1/2 months and all of my negative reports minus 2 are paid and in good standing. The credit system is a joke and a fraud. I've done everything I can and my score keeps going down and I get NO answers. All I get it the same recanned bull answer of well scores change. No crap someone tell me right now why my score has gone down when things are paid. I'm so frustrated. I've spent close to 10 grand getting out of debt and I was in better shape before I started this worthless journey. I kept telling the phone rep that this is only happening on Experian and that my Transunion is fine but she continued to ignore me.

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I agree that the journey back can often be frustrating, puzzling, and sometimes seems backwards but it's not worthless at all. You have $10,000 less in debt and that's something to celebrate. I've always held the view that paying down and/or paying off debt always is a bigger priority than any credit score.

It usually takes time to learn about credit management. Should it be so seemingly complicated? In my opinion absolutely not but all we can do is learn how to work that system to our advantage. If you stay around and continue to read and research and ask questions I'm confident you'll learn what to do.

The worst thing you can do is give up because then you'll never recover. No situation is hopeless. If I can do it anyone can.

The knowledge and advice available here is second to none in my opinion. Tap into that knowledge and be patient and you'll be fine.

From a BK years ago to:
EX - 3/11 pulled by lender- 835, EQ - 2/11-816, TU - 2/11-782

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

[Anonymous]

I really hope this answer helps you and not frustrate you anymore. One, paying off debt that is in collections, does 0 to help you what so ever. My advise in the begining to you would have been, call the collections co and tell them if they want the cash, you want them to remove their collection off your report. That is the only time when you will benefit from a credit fico increase. Paying it off, makes the report date a current date vs the older date so the change in that date of reporting hurts the score. Then, because you have those negs. and you are applying for new credit, fico says you are a risk of defaulting so your score gets hit again. On the good note, if you pay the new credit cards on time every month, within 6 months, you will start to see increase in score.  As your collection acct age, your credit score will increase. The only time paying a debt helps your score sooner, is if it is 30 to 60 days pass due then you bring it current. other wise, you have to wait for that collections to fall off to see a big move up in your fico. SO, if you have a collections, for your fico, makes no sense to pay them but be aware, if they sue you in court and put a judgement on you, then, that would haurt, bad. So it is a riske factor, pay them to know they wont call but yet it wont help fico in short term or dont pay and just let it drop off in 7 years depending on what state you are in. Some states, 4 or 5 years it can be removed. I hope this helps. Dont give up! pay those new credit cards on time. Time is your best friend in this situation!!!