What does having a FICO 8 in the 800's typically mean?

[Anonymous]

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@Anonymous wrote:

Thank you for this post. 

I had a question on the AZEO plan.

I have three secured cards -- I make one purchase on them each month for under 10 dollars.

So my utilization is 1 or 2 per cent.

Will I get a FICO boost if I go strictly with AZEO -- use ONLY one card and keep the other two at zero balance?

Or are my utliization numbers so low that it will not make much difference.

Thanks.

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There are many FICO models.  FICO 8 is less sensitive to the factor you are thinking of (number of accounts reporting a balance) than is (say) the FICO EQ mortgage score or the Bankcard enhanced flavors of FICO.  So the answer to your question depends on which model you might be thinking about.

Another difficulty we'd have in answering your question is that we don't know how many open accounts you have besides those three cards.  You might have a number of open loans, for example.  You might have open LOCs.  Etc.

PS.  You have posted the same question in another thread.  This is called cross-posting and is discouraged by the moderators.  Just an FYI.

[trusty]

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@Flex1 wrote:

I'm at 787 Fico8 and for me, I have no revolving balances. So I started wondering.... What about all the people who have even higher Fico 8's to the top of the scale? My thoughts is that this has something to do with carrying little to no balances on the cards and or very small balances with such high limits that utilization is always in a favorable place. Can you guys give me your thoughts on this? I know that age of account and history etc... have a factor in this. But just generally speaking if you have no negative history at all. 

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Here's how I read this topic to mean:

Having an 800+ credit score typically means you've been shining in your career and your financial obligations, for pushing a decade or longer. (Although it can probably be done in round about half a decade - with self help communities like these)

What all of this solid financial history means.... is that you will essentially have carte blanche - to redeem any upper credit limits that your income can qualify you for, so long as you don't go overboard with it. It will also mean access to exclusive card products, clubs, and rewards programs that others haven't qualified for yet. 

But, the main thing is income. You can have an 800+ score, but unless you have the income to support it... you can only hurt yourself, by going in too deep. Some banks will have already tightened up their standards, since the last great recession of 2008; when people were buying multitudes of properties on one income. (epic fail) Unfortunately, from a credit card standpoint, every bank isn't equipped or even necessarily run with the mindset to protect the successful consumer from themselves, and their own debt to income calculations - or lack thereof.

But, in the main, any score from 760 to 780 and up - is going to get you top billing for most prime products, (mortgage and auto) particularly if your income is more than adequate, and seasoned; so long as you stay within what your income can afford.

Most consumers that exceed 800 didn't get there by accident; they know what they're doing... they had a plan - and still have a plan, ongoing.

[Queen_Etherea]

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@Anonymous wrote:

Age of Oldest Account continues to give you some help up until 17 years at least.  Possible benefit from going higher but not proven.

Average Age of Accounts (AAoA) continues to give you some help up until 7.66 years at least.  Possible benefit from going higher but not proven.

Age of Youngest Account appears to give you benefit when it crosses 3 months, 6 months, and most notably 12 months.  Some people speculate about an advantage at 24 months but that is unproven.

Percentage of accounts that are new (define new here as < 12 months old) likely affects your score, but specific info here is sketchy.

Inquiries harm your score as you doubtless know, though not by much.  Ideal number is zero but it is unwise to allow a hyperworry here to prevent you from opening occasional accounts as needed.

That's all age-related stuff.

Having open installment debt (aka a loan) helps FICO 8 if your open loans are mostly but not entirely paid off.  The boost here can be 30-40 points, compared with having no open loans.

All FICO models benefit from having at least three open credit cards, one loan (closed or open), and six accounts total (closed or open).  Exact numbers are not known.  There might be some marginal value in having seven open accounts and ten accounts total, but that's speculative.

There may also be a small penalty from having a huge number of open accounts (e.g. 20 cards).  There is some evidence from that based on negative reason statements.

Consumer Finance Accounts (CFAs) hurt one's score even if they are managed perfectly.  CFAs should be avoided at all costs, though the penalty is probably not that much.

No FICO model penalizes you for the presence of store cards or for not having big credit limits, though other non-FICO models often do.

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You mentioned CFA's, so I have a question:  I was looking at one of the older scoring models and they listed CFA as a negative reason for my scoring. Which one of my accounts is a CFA?? I have all my cards/loans listed in my signature, but here they are:

Wells Fargo Platinum

Capital One Quicksilver

Discover IT

AMEX Blue Cash

PayPal 2% MC

Amazon Store Card

CareCredit

PenFed Gold

PenFed PowerCash

American Honda Finance (Car Loan)

[SouthJamaica]

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@Flex1 wrote:

I'm at 787 Fico8 and for me, I have no revolving balances. So I started wondering.... What about all the people who have even higher Fico 8's to the top of the scale? My thoughts is that this has something to do with carrying little to no balances on the cards and or very small balances with such high limits that utilization is always in a favorable place. Can you guys give me your thoughts on this? I know that age of account and history etc... have a factor in this. But just generally speaking if you have no negative history at all. 

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I personally believe that the FICO algorithms have a hidden agenda, which is encouraging folks to borrow, since folks who borrow are more profitable banking customers.

So having all zero balances reported among your revolving accounts causes a point loss, which can be avoided by having one account report a balance.

And having no unpaid installment loans on your record causes a point loss as well, among some of the FICO scoring models.

[trusty]

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@SouthJamaica wrote:

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I personally believe that the FICO algorithms have a hidden agenda, which is encouraging folks to borrow, since folks who borrow are more profitable banking customers.

So having all zero balances reported among your revolving accounts causes a point loss, which can be avoided by having one account report a balance.

And having no unpaid installment loans on your record causes a point loss as well, among some of the FICO scoring models.

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I agree. But, the agenda is not really even hidden. Participation in the lending game is mandatory to have the wherewithal to borrow when we need it. It's also mandatory to be able to obtain affordable insurance rates. It's just all around - either you're fully in, and set at the table, and you benefit from the systems in place; or, you can try to live - cash only, and you get nothing other than peace of mind... or an incredible lack thereof.

[Pikaboo-icu]

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@Queen_Etherea wrote:

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@Anonymous wrote:

Age of Oldest Account continues to give you some help up until 17 years at least.  Possible benefit from going higher but not proven.

Average Age of Accounts (AAoA) continues to give you some help up until 7.66 years at least.  Possible benefit from going higher but not proven.

Age of Youngest Account appears to give you benefit when it crosses 3 months, 6 months, and most notably 12 months.  Some people speculate about an advantage at 24 months but that is unproven.

Percentage of accounts that are new (define new here as < 12 months old) likely affects your score, but specific info here is sketchy.

Inquiries harm your score as you doubtless know, though not by much.  Ideal number is zero but it is unwise to allow a hyperworry here to prevent you from opening occasional accounts as needed.

That's all age-related stuff.

Having open installment debt (aka a loan) helps FICO 8 if your open loans are mostly but not entirely paid off.  The boost here can be 30-40 points, compared with having no open loans.

All FICO models benefit from having at least three open credit cards, one loan (closed or open), and six accounts total (closed or open).  Exact numbers are not known.  There might be some marginal value in having seven open accounts and ten accounts total, but that's speculative.

There may also be a small penalty from having a huge number of open accounts (e.g. 20 cards).  There is some evidence from that based on negative reason statements.

Consumer Finance Accounts (CFAs) hurt one's score even if they are managed perfectly.  CFAs should be avoided at all costs, though the penalty is probably not that much.

No FICO model penalizes you for the presence of store cards or for not having big credit limits, though other non-FICO models often do.

---

You mentioned CFA's, so I have a question:  I was looking at one of the older scoring models and they listed CFA as a negative reason for my scoring. Which one of my accounts is a CFA?? I have all my cards/loans listed in my signature, but here they are:

Wells Fargo Platinum

Capital One Quicksilver

Discover IT

AMEX Blue Cash

PayPal 2% MC

Amazon Store Card

CareCredit

PenFed Gold

PenFed PowerCash

American Honda Finance (Car Loan)

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The only possibility on that list would be American Honda Finance as the rest are definitely not CFAs..

Maybe Credit Care but I've not seen anyone else post about it with them.

CFAs and I have a love hate relationship- they love me, I hate them LOL

I was unaware that even positive payment history would be viewed as a neg on my score.

It's why my EX is so much lower than the others but I used them a LOT (Affirm).. I recently disputed them all, they were all closed with excellent pmt history- so I'm keeping my fingers crossed they will be deleted..

Perhaps somebody know for sure about AHF but it's the only one that could be considered a CFA.

Have you looked at a hard copy of your credit report? Not the online/digital version?

I was informed that the coding for CFA should be accurate on that. 

[Queen_Etherea]

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@Pikaboo-icu wrote:

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The only possibility on that list would be American Honda Finance as the rest are definitely not CFAs..

Maybe Credit Care but I've not seen anyone else post about it with them.

CFAs and I have a love hate relationship- they love me, I hate them LOL

I was unaware that even positive payment history would be viewed as a neg on my score.

It's why my EX is so much lower than the others but I used them a LOT (Affirm).. I recently disputed them all, they were all closed with excellent pmt history- so I'm keeping my fingers crossed they will be deleted..

Perhaps somebody know for sure about AHF but it's the only one that could be considered a CFA.

Have you looked at a hard copy of your credit report? Not the online/digital version?

I was informed that the coding for CFA should be accurate on that. 

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Ugh I wasn't even going to go with Honda because I was pre-approved with PenFed, but Honda was giving me a better rate. The finance guy said it was a good thing I was going with Honda directly (I bought a Honda Civic), so I didn't think anything negative was going to happen! I don't understand how they can be a CFA, though. I didn't think it's really all that easy to be approved through Honda directly.

I'm going to request a paper copy of my report and see if anything shows up on there. Thanks for the tip! I'll let you guys know if I find anything.