@mgood wrote:
@SouthJamaica wrote:
@C_DUBYA wrote:That is a bit confusing as everyone appears to push AZEO mindset. If that is the case why is AZEO promoted so much for score improvement?
AZEO was developed as a way of insuring that you are not being penalized for too many accounts with balance in any scoring model. In most of the modern scoring models, as long as more than half of your revolvers are reporting zero balances, it doesn't matter much if you have one account with a balance or six accounts with a balance. In most cases having a minority of accounts reporting balances is just as good as having only one account reporting a balance.
So in my view AZEO is widely misunderstood in these forums. It's really just an insurance policy if you want to be sure to maximize your scores in the older scoring models, as for example when you're about to apply for a mortgage.
That's something I've wondered. Is it different for the various scoring algorithms?
Lot's of people swear by AZEO, but I read that 1/3 is ok, or 1/4. More recently I commonly hear "less than 50%."
So you're saying that for the newer models, less than half avoids the penalties. But do older models, like the mortgage scores, benefit from some smaller number showing a balance? If you have a dozen or so accounts, does it really matter anywhere if it's AZE2 instead of AZE1?
Sorry about the baby penguins @Remedios
It varies with different (a) bureaus, (b) scoring models, and (c) credit profiles, as to how many "accounts with balance" are enough to trigger some point loss. I'm not knowledgeable enough to tell you which is which. Perhaps @Thomas_Thumb or @Revelate could give you a more precise answer.
