cancel
Showing results for 
Search instead for 
Did you mean: 

Update: FICO2 experiment (is it worth it?)

tag
calyx
Super Contributor

Update: FICO2 experiment (is it worth it?)

December 2019 update & summary:

 

This all started because I have an AU and I want to app for a card with an institution who pulls FICO2.
YES, my FICO8s were nearly 800, but my FICO2 was just over 700 (FICO2 liked me dirty and old, not clean and young);  AZEO or any micromanaging is generally beyond the work I want to do for my credit score.

Instead this had turned into a crazy experiment - towards the end, you'll see spreadsheets with more details sussed out, and once I app for the card I want (for good or ill), I will document the crash and burn of FICO2 as I let everything report again, because after working to make it pretty, I will enjoy not working to make it crash (I'm a masochist like that).

 

Maybe this will help others figure out if they want to go through the effort - but at least it'll entertain me.

 

Summary:
With 8 reporting cards (including an AU):  AZE2 vs AZE3 is not worth additional effort (imo).   But AZE1 vs AZE2 *is* worth the effort if you can manage it.  My issue was getting the AU to report to 0 because I was carrying a balance on another card (0%) and I could not get to AZE1 without AU going to 0.  Luckily, it was a chase card and AU had gotten another card and moved most of their spend to that card anyway, so PIF early was not an issue.  

 

Original post:

Is it worth the effort: AZE2vs 3 (w/ AU) on FICO 2?

 

I've been reading through the forums, and I haven't quite answered my question, so apologies if this has been discussed/asked and I missed the thread.


I would like to apply for a product in a few months that uses FICO2.
My understadning is that I will get the best results with AZEO, but I can't get all the way down there.

I am an AU on a card giving me a hefty AAoA bump, but that's the person's only card, so it always carries a balance (usually <5-8%, nothing bad;   PIF monthly).
I also have a 0% finance card that I'm carrying a sizable balance on (<8%, but it's still 4 digits and I have no intention on paying it off early).  

With this - at best (with effort), I can do AZE2.   Without effort, I can easily AZE3.    Have people here seen much of a difference on AZE2/AZE3?     If not, I'd rather not change my spend patterns and keep maximizing my cash/points back.

 

Thanks!

 

Happy practitioner of AZE7or8or9or10 | Team Finances > FICO
Message 1 of 100
99 REPLIES 99
Anonymous
Not applicable

Re: Is it worth the effort: AZE2vs 3 (w/ AU) on FICO 2?

I guess you'd have to look at where your Fico 2 score lands relative to what the prospective lender with which you're going to product app requires for the best terms/rate.  If you're already in an ideal place, no need to sweat the few points you may miss out on with AZE2 or AZE3.  Another factor that may matter is your total number of accounts, as the percentage of accounts with a balance can come into play.  For example, someone at AZE3 that's got 5 total accounts would likely see a different scoring change than someone that went to AZE3 with 15 total accounts.

 

Really the best thing you can do is some simple testing on your own.  You said you've got a couple of months, so you could try AZE2/AZE3 and pull your Fico 2 score and see how it reacts. 

Message 2 of 100
calyx
Super Contributor

Re: Is it worth the effort: AZE2vs 3 (w/ AU) on FICO 2?

I have Experian's monitoring/score service, so it's easy to check my FICO2 daily.
I'm just fundamentally lazy and was hoping collective knowledge would mean I didn't have to do my own work Smiley LOL

On EX, I have 7 open revolvers, 1 closed, 2 installments, and 1 AU (installment), for a grand total of 11 accounts (8 revolvers).  I think <30% revolvers with balances is usually what I see cited and one/1 AU would fall under that at least.

And I do have some time to play, so there's always that.   I've got a few days before my next card reports, so I can start knocking off balances soon.  

Happy practitioner of AZE7or8or9or10 | Team Finances > FICO
Message 3 of 100
Anonymous
Not applicable

Re: Is it worth the effort: AZE2vs 3 (w/ AU) on FICO 2?

@calyx  Personally  find it to stressful to pay az.   Based onthe scores in your sig 770 and up your are not going to get a better deal by pushing it.   AZ involves almost daily payments and hours of micro managing   I have better things todo with my time.   You might get 3 to 5 points but at 770 that is not going to get you a better rate or limit.   DW score was arround 770 when she got her Chase Freedom card. With that score she got their best apr and large limit $21,700  When we financed our new Jeep 1 1/2 years ago we got navy's best rate 2.99% with similar scores.  As our scores now hover between 790 and 830 I find it harder to cli because any balances we carry are usually under 5% cranberry and lenders mke money off people carrying balances not payng them most of the time or using 0%  bt.   I will say I like the $5,000 0% fee plan it amex gave us 24 months as a promo however. It paid our taxes.    

Message 4 of 100
Anonymous
Not applicable

Re: Is it worth the effort: AZE2vs 3 (w/ AU) on FICO 2?


@Anonymous wrote:

AZ involves almost daily payments and hours of micro managing...    


I mean, I guess it's different for everyone, but I personally have never found AZEO implementation to involve anything more than 1 or 2 extra payments just before statement cut and no more than 5-10 minutes of invested time to do so.  I can see how it may become an nuisance if one were to micromange it month after month, but we're only talking about a single cycle as prep for an upcoming app.

Message 5 of 100
Anonymous
Not applicable

Re: Is it worth the effort: AZE2vs 3 (w/ AU) on FICO 2?


@Anonymous wrote:

@Anonymous wrote:

AZ involves almost daily payments and hours of micro managing...    


I mean, I guess it's different for everyone, but I personally have never found AZEO implementation to involve anything more than 1 or 2 extra payments just before statement cut and no more than 5-10 minutes of invested time to do so.  I can see how it may become an nuisance if one were to micromange it month after month, but we're only talking about a single cycle as prep for an upcoming app.


Dw and I have about 25 cards between the two of us.   Most get about 1  transaction per month  and about  6 get regular use.  We do max points/cash back.  You still have to go in every few days and check balances and make payments.  If  we are going to keep cranberry low you have to be on the look out for that  small $5 charge that came in right at the end of the cycle. I don't trust when cc report to the agencies.  I can't tie several  balances on the end of the cycle statements back what is reported onthe credit report.    If I were doing this for only one month  I would consider paying everything off but one month and not sing anything but one card the following month.     I just find this to stressful for the points.  I am sitting on 815 fico across the board and I suppose I  could work the cards for 3 or 4 more points but what would that get me?    Our Jeep is at 2.99%   Most of our cards are prime and at the lowest or next to lowest % rate. 

Message 6 of 100
calyx
Super Contributor

Re: Is it worth the effort: AZE2vs 3 (w/ AU) on FICO 2?

On my FICO 2, I do see high balances/too many cards as negative reason codes, and I don't practice AZE-anything, since I use every one of my cards and I'm done rebuilding.   I also let my card report 'natural' utilization now (I was controlling for <30%)

 

I am paid 1x/month, so what I normally do is log in on payday, pay everything, move any leftover cash (above ~250) out of my checking to a high yield savings and then let it ride til the next month (I follow a zero based budget, so the cash is always there).   AZ-anything would be a total change in how I try to manage my cards, and I went hands off to stop with the anxiety I built up over my rebuild over micromanaging (thanks to discussion on MF, particularly in the garden).   I have not changed/moved any due dates, because the 1/month payment works out fine, as I'm paying cards either after the statement cuts or before it's due anyway.   The only two exceptions are my auto & student loans, which are auto deducted (rate cuts if I do that).    Maybe I'll reevaluate in Dec or Jan since I'm planning on apping in the new year.

 

I appreciate the advice!

Happy practitioner of AZE7or8or9or10 | Team Finances > FICO
Message 7 of 100
Anonymous
Not applicable

Re: Is it worth the effort: AZE2vs 3 (w/ AU) on FICO 2?

If your carrying a high balance on a low credit line, nothing you can do will help other than paying the debt down/off.
And stop using it for awhile.
After 8 months or so attempt to boost the available credit line, use it moderatly pay it off and garden again for a few months, and try to increase the credit limit yet again.
It's actually best to have very few cards that have built credit up over a longer period of time, than to have a large portfolio of access to credit with smaller credit lines.

Smaller credit lines are usually lines of credit below $2,500.00.

Example if you have 11 open lines of various revolving credit, such as closed, and open loop cards, and you carry a high balance on the open loop cards, but low balances on closed loop (store branded cards higher default rate), and you apply for car financing (I did), also I did John Deere).
I was approved for $16k used car financing as I was inquiring about one particular model I liked despite the year it was released.
And secondly was looking to buy a lawn mower/tractor, and JD approved me for $15k.
However that caused my credit score to tumble on an extraordinary scale.
Although technically they both fall within the same category, and FICO even advertizes that motor vehicle financing as well as mortgage financing via shopping the best rates are treated as a single inquiry, I have found this is not true at all, Because the creditor reporting did not match the lender type accordingly. In other words the bank.FICO, lender have no set definition of status, and may allow for arbitrary reporting, that places an inquiry into a hard pull that is not associative even though by design is applicable. That's a fallicy in the reporting structure.
I know this may appear to be an off topic response, but there is a connection of mutual education and learning from this post.


Message 8 of 100
Anonymous
Not applicable

Re: Is it worth the effort: AZE2vs 3 (w/ AU) on FICO 2?


@Anonymous wrote:


Dw and I have about 25 cards between the two of us.   Most get about 1  transaction per month  and about  6 get regular use. 


It sounds to me then if you were to set up ~19 of them to auto-PIF your current balance 2-3 days before your statement cuts that you wouldn't have to worry about those.  That would just leave your other 6 more frequently used cards, which you could set up auto-pay for your previous statement balance.  Then on a month where you wanted to micromanage AZEO (or AZEx) you'd need only log into those 6 accounts (say) 2 days before statement cut and make another payment if necessary.  It's all in the eye of the individual if that process constitutes significant micromanaging/time.  Some would argue yes, others would say no.

Message 9 of 100
randomguy1
Valued Contributor

Re: Is it worth the effort: AZE2vs 3 (w/ AU) on FICO 2?

No one with an 800 FICO needs to AZEO. Don’t even know why that is in discussion. 🙄
Message 10 of 100
Advertiser Disclosure: The offers that appear on this site are from third party advertisers from whom FICO receives compensation.