Score Dropped from 809 to 754- due to new auto loan or Xmas shopping on CC?

[Anonymous]

Hi all,

First post here.

My son totalled his car this past week (he is fine :-) ). so rather than try and buy an unknown used car, I gave him my 5 y.o. car to drive (paid off this past summer). 17K car loan @ 2.9% for 60 months (prior 2 loans paid in full on past cars).

Today, my score went down from 809 to 754.

Admittedly, I have higher CC balances at the moment, with Xmas shopping and some spring vacation airfare, etc. purchased recently. Amount owed is approx. 3.5K on an approximate 75-80K CC aggregate possible limit.

Questions:

-  would this new auto loan be enough to drop the score that much? Others report only a 20 point average drop.

- or, is it a combination of factors, including the Xmas debt? BTW- I plan on paying 75-80% of that 3.5 K off in January.

thanks!

[Anonymous]

Hi SHV2

Welcome!  And I'm glad your son is fine (and still on wheels).

Do you have a single card with higher utilization  - or are you reporting balances on more accounts than usual?  (And that number of accounts reporting a balance would include the new auto loan)

And - of course - where are you pulling your score from?

[Anonymous]

thanks! airbags deployed  which helped lots.

It is probably both- more cards in use and a couple with higher util %

[MarineVietVet]

---

@Anonymous wrote:

Hi all,

First post here.

@Anonymous son totalled his car this past week (he is fine :-) ). so rather than try and buy an unknown used car, I gave him my 5 y.o. car to drive (paid off this past summer). 17K car loan @ 2.9% for 60 months (prior 2 loans paid in full on past cars).

Today, my score went down from 809 to 754.

Admittedly, I have higher CC balances at the moment, with Xmas shopping and some spring vacation airfare, etc. purchased recently. Amount owed is approx. 3.5K on an approximate 75-80K CC aggregate possible limit.

Questions:

-  would this new auto loan be enough to drop the score that much? Others report only a 20 point average drop.

- or, is it a combination of factors, including the Xmas debt? BTW- I plan on paying 75-80% of that 3.5 K off in January.

thanks!

---

Hello and welcome to myFICO.

It could very well be a combination. You probably lost a few (hard to say how many) points with the new loan and if your utilization went up that doesn't help. But once you get that utilization back down you'll see a recovery.

What was the utilization before and after the CC balance increase?

But still 55 points is quite a bit. Could anything else have changed besides the new loan and higher utilization?

From a BK years ago to:
EX - 9/09 pulled by lender 802, EQ - 10/10-813, TU - 10/10-774

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

[haulingthescoreup]

---

@Anonymous wrote:

Hi all,

First post here.

@Anonymous son totalled his car this past week (he is fine :-) ). so rather than try and buy an unknown used car, I gave him my 5 y.o. car to drive (paid off this past summer). 17K car loan @ 2.9% for 60 months (prior 2 loans paid in full on past cars).

Today, my score went down from 809 to 754.

Admittedly, I have higher CC balances at the moment, with Xmas shopping and some spring vacation airfare, etc. purchased recently. Amount owed is approx. 3.5K on an approximate 75-80K CC aggregate possible limit.

Questions:

-  would this new auto loan be enough to drop the score that much? Others report only a 20 point average drop.

- or, is it a combination of factors, including the Xmas debt? BTW- I plan on paying 75-80% of that 3.5 K off in January.

thanks!

---

A queston: are these FICO scores, that you got here? If so, look on screen two of the older report and of the newer report. What are the negatives that are listed? --although if the older score came from myFICO, it won't display any negatives, since your score was 800+.

At any rate, you need to know what is the new listed negative, because that's what made the score change.

If you got your score somewhere else (a credit bureau, TrueCredit, etc etc), it's a FAKO, and your FICO score might not have changed at all.

eta: oh, and let me add to the others my good wishes in your son's health. My younger daughter hit a telephone pole in an ice storm, and we're doing the same thing. Other than being scared witless by the airbags deploying, and some soreness in her back and shoulders over the following few days, she's fine. Whew...

[Anonymous]

thanks guys for the well wishes re my son. Yeah,. slightly bruised hand and a seat belt rash on the neck- other than that, no issues. A car pulled out of a stop sign intersection right in front of him; he had the presence of mind to not t-bone the other driver's door, but rather try to swerve towards the front of the other car. Hit, bounced, hit again, and went across 3 lanes. Whew! Glad your daughter is ok.

Ok, re FICO... I subscribe to score watch, so the score is from Equifax. I haven't pulled a score power report in a year, it says I have 3 available- maybe I should use one.

What is interesting is that, under credit alerts,  new accounts, it says " Currently monitoring, no activity found yet ", so the new auto loan does not seem to yet appear.

but the actual alert from the lowered score refers to:

"This score decrease may be caused by these 2 new reasons:

•You have too many credit cards carrying balances.
•The remaining balance on your non-mortgage installment loans is too high."

...which seems to support my theory. Should I pull a Score Power? Admittedly, 754 isn't too bad, and if it improves back to near or above 800 in 6 months, all will be fine.

Utilization on CC has been a bit higher on an AMEX card, almost 50% on one and 15% on the other. Like I mentioned, will be paid in January. I got engagd a couple of weeks ago, so some spring trip plans were made:-)

thanks!

[llecs]

I was about to question whether or not the new loan could have reported that fast, but I see you just made mention of it not reporting. While new accounts can ding your FICO score (temporarily), it's good to know we can exclude that factor.

What kind of Amex CC do you have? If it's a charge like a Green, Gold, Platinum or the like, then FICO ignores the balance and the "high balance" per utilization for your EQ FICO score. If scored like a revolving, like I think some of their cards do, then it is factored in.

Changes in utilization can easily drop your score, especially if more CCs are carrying balances. Reset your target score for Scorewatch and see if it rebounds next month when you pay and your new balances report.

[marty56]

To help mitigate any score damage from increased CC usage and as llong as you PIF each month, if you know the statement drop date of your CC, you can control the reported balance by making a payment 3 days before the drop date.

[Anonymous]

thanks for the info everyone.

curious- how does paying 3 days prior to the subsequent statement drop (versus anytime after the current statement) help the scores? wouldn't the reduced balance be reported the same way regardless?

BTW- the 2 Amex cards are indeed revolvers- Amex Blue and Amex Clear. They may have indeed contributed to the score reduction, although I have had nearly the same util % on them in the past without a significant reduction. Hence, I still suspect something else... I wonder if the auto loan has indeed reported, and the system hasn't shown it yet.

Anyway, it looks like the best plan of action is to pay the cc balances and monitor the score. With a Bahamas trip and then a FL trip (kids and grankids) over the next 2 months, good luck with that! What the heck, 809 score in the upper midwest winter, or 754 score sipping drinks with umbrellas in them, next to palm trees... I will take the lower score. :-)

[MarineVietVet]

---

@Anonymous wrote:

thanks for the info everyone.

curious- how does paying 3 days prior to the subsequent statement drop (versus anytime after the current statement) help the scores? wouldn't the reduced balance be reported the same way regardless?

BTW- the 2 Amex cards are indeed revolvers- Amex Blue and Amex Clear. They may have indeed contributed to the score reduction, although I have had nearly the same util % on them in the past without a significant reduction. Hence, I still suspect something else... I wonder if the auto loan has indeed reported, and the system hasn't shown it yet.

Anyway, it looks like the best plan of action is to pay the cc balances and monitor the score. With a Bahamas trip and then a FL trip (kids and grankids) over the next 2 months, good luck with that! What the heck, 809 score in the upper midwest winter, or 754 score sipping drinks with umbrellas in them, next to palm trees... I will take the lower score. :-)

---

For most cards the balance is reported on the monthly statement and it's this balance that is used to calculate your utilization for the month. Therefore the lower your reported balances are the lower your utilization and that's a good thing. Utilization on revolving credit is 30% of your total score so it's very important.

From a BK years ago to:
EX - 9/09 pulled by lender 802, EQ - 10/10-813, TU - 10/10-774

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