Suggestions for debt repayment strategy to boost score

[Anonymous]

Planning to finance major purchase within 6 to 8 weeks and current FICO scores from this site are TU 771 and EQ 764. During past 10 months of observation have seen material variances depending on cc balances at time of pull.

Both scores show one neg of too high installment balances at $45K, all of student loans; 2 are my co-sign for daughter who just began payments two years ago after graduation and 1 that has a $10K balance down from initial of $20K that is my individual loan taken out for daughter's education.

On cc revolving balances, TU shows 3 accounts that total $15,122 while EQ shows 2 accounts that total $2,756. DIfference is a 0% interest fixed term payment account and it has never shown on EQ. Overall cc utilization shows as under 2%.

Would it be better to pay-off my one student loan that will drop installment balances to under 65% of original amounts (I'm don't pay on the two that I co-signed) versus using same dollars to pay-off the $12K revolving balance that only shows on one report? I don't know which report lender will pull, and I would prefer not to pay 0% interest rate loan early.

Of should I bit-the-bullet and pay off both?

My primary concern is that neither score falls below 760 due to some unforeseen scoring glitch on day they are pulled because I don't have much cushion now.

BTW other inform are positives; 30+ year payment history, average age 9+ years, one 30-day 56 months ago (this does no show on the TU report).

[Anonymous]

Hi thetalent,

I've been watching DH's and my FICO scores as we pay down (and sometimes off) installment loans.  In particular, I've looked for score increases as my student loan has hit different percentages.  I've yet to see a FICO score impact and my student loan is below 40%.  Utilization on installments is scored much differently than utilization on revolving.

On a slightly different tac, you may see a score boost if you are able to show a zero balance on less than 50% of all your open accounts.  Paying off an installment, though, typically removes it from the open category and it becomes a paid, closed account.

You may also see a score increase if you report fewer balances on your revolving cc's.  If you now show a balance on two revolving accounts, you may want to pay one down so it reports at zero.  Some CRA's do not like to see all zero balances on your revolving accounts - so leave one reporting - and reporting a small (less than 9%) balance for best FICO scoring.  YMMV, of course, but this is a general rule that works great for most folks.

Hope that's helpful - and best wishes!

[Anonymous]

Thanks beamMEup for your comments.

Your position is that reducing installment may not help that much. FYI the reason I targeted it was that my EQ neg was that installment balances were too high at 76% and most high scorers were below 65%. Good point though not to pay one off because that would result in higher util factor, so I think I will pay down to 60%.

In regard to cc util, I don't think there is a problem because both EQ and TU list as a positive low credit util at 2%, even though the TU usage seems to ignore the $12K balance on 3rd cc acct. It's clearly a revolving account, and if it were considered probably no longer a positive since util would be 10%.

Maybe is different scoring with TU08, go figure. That is my universal problem with trying to use the negs and pos to develop a strategy to increase score. In my case, what shows as a neg seems redonkulous as one's score increases, but at least it's consistent with EQ caveat about items hurting your score from their site, and I quote, "Because your FICO score is high, these reasons may seem 'picky' and you should not consider them to be serious flaws in your credit history. They are simply factors on which you did not score the absolute maximum possible points and leave some room for improvement."

Oh well, keeping my fingers crossed that day credit report pulled is a good day with target of only 1 cc with a balance (instead of 3) out of 16 open accts and <1% utilization.