Score drops 13 points over 1 account...WHAT?

[Anonymous]

I had a 13 point drop when an account that has had a zero balance for more than a year adjusted the available credit downward...How can THAT be? I have no late payments on anything and moderate balances on some cards covering medical debt - but again nothing has ever been late? What is going on that an insignificant credit line drop on an unused line of credit causes such a ridiculous hit?

No other alerts or changes were noted and the ODD this is my score went up under another reporting company.

[MarineVietVet]

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@Anonymous wrote:

I had a 13 point drop when an account that has had a zero balance for more than a year adjusted the available credit downward...How can THAT be? I have no late payments on anything and moderate balances on some cards covering medical debt - but again nothing has ever been late? What is going on that an insignificant credit line drop on an unused line of credit causes such a ridiculous hit?

No other alerts or changes were noted and the ODD this is my score went up under another reporting company.

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Hi and welcome to myFICO.

My guess is that since there are balances on other cards when the credit limit was lowered that raised your utilization. If the utilization went up enough that might account for 13 points. Do you know what the balances and credit limits were before and after the credit limit decrease?

From a BK years ago to:
EX - 9/09 pulled by lender 802
EQ - 7/06-663, 3/10-800, 10/10-813
TU - 10/10-774
You can do the same thing with hard work

[Anonymous]

It was only one account that droppped...3100 to 2500 and it hasn't had a balance for  well over a year. (dell Financial - cit bank) In the month of September I paid down more than 1000 of debt on roughly a 17000 load spread out over 4 accounts. (I had to have an oral surgey not covered by my insurance.) Each account has at least a 20% margin between balance and avialable credit and they are not utlized so the balances do nothing but decline.

[MarineVietVet]

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@Anonymous wrote:

It was only one account that droppped...3100 to 2500 and it hasn't had a balance for  well over a year. (dell Financial - cit bank) In the month of September I paid down more than 1000 of debt on roughly a 17000 load spread out over 4 accounts. (I had to have an oral surgey not covered by my insurance.) Each account has at least a 20% margin between balance and avialable credit and they are not utlized so the balances do nothing but decline.

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It would still be helpful if you don't mind to post the total balances and available credit limits on all accounts. You don't have to name any lenders or anything like that just the numbers. That way we can look and see if your utiization was affected and if not perhaps there is another reason for the score drop.

From a BK years ago to:
EX - 9/09 pulled by lender 802
EQ - 7/06-663, 3/10-800, 10/10-813
TU - 10/10-774
You can do the same thing with hard work

[Anonymous]

As of today, and this includes September pays:

Acct 1 - 5326  CL 8000

Acc 2 - 2944 CL 5000

Acct 3 - 8737 CL 12500

Acct 4 - 625 CL 6000

Gas card - anytime there is 300 - 400 reported with a 3000 CL

Zero balance accounts

3 with total CL of ~7000 (dell, furniture - one time use stuff)

[MarineVietVet]

I assumed the CL's you wrote were after the CLD so I came up with these numbers:

Total balances $18,032 (I used the higher figure of $400 for gas). Total CL $41,500. 

So 18,032/41,500= 43% utilization. If you add back the $600 lost in the CLD the utilization would be 39%. So that CLD cost you approximately 4% in utilization.

I'm not sure if 4% is enough to lower your score 13 points but it might be. Even 39% utilization is pretty high. The consensus around here is try not to have any more than 9% overall utilization and 9% individual card utilization.

Do you know if anything else has changed in your credit profile besides the CLD? Any new accounts added or old ones dropped off?

Edited cuz' I kent typ rite!!!

From a BK years ago to:
EX - 9/09 pulled by lender 802
EQ - 7/06-663, 3/10-800, 10/10-813
TU - 10/10-774
You can do the same thing with hard work

[haulingthescoreup]

If MVV's figures are correct --and I have no doubt that they are!!! --it might be that 40% util is one of those break-points we like to theorize about, along with under 10%, under 20%, etc. So perhaps moving from 39% to 43% bumped OP up into a higher util category.

Kinda picking this out of the air here, but I've seen similar stories. If so, it's not the 4%; it's that the 4% moved from under 40% to over.

[Anonymous]

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@haulingthescoreup wrote:

If MVV's figures are correct --and I have no doubt that they are!!! --it might be that 40% util is one of those break-points we like to theorize about, along with under 10%, under 20%, etc. So perhaps moving from 39% to 43% bumped OP up into a higher util category.

If so, it's not the 4%; it's that the 4% moved from under 40% to over.

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+1.  That's exactly what I was thinking.  I just thought I'd post that because it's always good to know that great minds think alike. 

And it's also why it's very helpful to have the before and after numbers, as MVV requested.  Smart request.  OP's in good hands!