@C_DUBYA wrote:Hello all
I used the myFico tool but it never really lines up to reality. So I am curious if others can answer from real world experience.
My utilization was 74% in January across my 24 cards. I have this all paid down as of today to 11% across all cards. I have 24 CC, and all are at 0 except 5 cards that have balances. Where as in January only 3 were at 0 and most others were in 80% or higher util.
Knowing that, what kind of score increases should I expect realistically? Small bump? Large bump?
Thanks for any insight.
Very large bump. Congratulations.
what does the simulator say?
I imagine if the only thing that's changing is utilization, it should be fairly accurate, you can check with the experian simulator as well to sanity check
Sorry, I previously failed to look at the scores in your signature footer.- It suggested some derogs are still present but, aged with reduced impact. Derog aging would account for your score boosts to date.
Dirty scorecards put more weight on factors such as months since last derog and less weight on reducing utilization (see chart). The score improvements will be much less than the above clean scorecard estimate as a result - perhaps 60% less unfortunately.
The primary benefits will come from reducing accounts with balances (10 points), dropping all cards out of max out territory with highest card still above 70% (5 to10 points) and overall debt reduction in $$ (10 points). Total benefit 25 to 30 points for dirty scorecard profile.
[Geting those remaining 70% cards under 30% by July will help a bit. FYI - let one of your revolving credit cards report a balance to avoid the "no recent revolving credit activity" penalty. Just let a charge report on your statement and pay by the due date.]
You say:
"Currently I am not doing anything with credit other than refi a motorcycle and purchase a car in July. I am awiting to make those moves when my scores are their best for obvious reasons. I am just impatient and trying to get an idea on what I can expect. So score wise I was looking at FICO8, AutoFico8, and credit 8".
Be aware that seeking new credit, such as # inquiries in last 12 months, is given more weight on dirty scorecards. So expect an associated score drop. Might want to do the refi and purchase in the same timeframe to minimize an inquiry impact from one affecting the other.
Given delinquencies, the biggest future score improvements will come from the removal of the last major one (charge off). When that happens (if some 30 or 60 day aged lates remain), an instant 50 to boost is possible. Then another boost of 25 to 30 points when the last minor late falls off.
BTW: Congratulations on the debt reduction - it is quite an accomplishment.
@Thomas_Thumb wrote:
@C_DUBYA wrote:Hello all
I used the myFico tool but it never really lines up to reality. So I am curious if others can answer from real world experience.
My utilization was 74% in January across my 24 cards. I have this all paid down as of today to 11% across all cards. I have 24 CC, and all are at 0 except 5 cards that have balances. Where as in January only 3 were at 0 and most others were in 80% or higher util.
Knowing that, what kind of score increases should I expect realistically? Small bump? Large bump?
Thanks for any insight.
There are some important factors you failed to mention that will affect score change (the most influencial being a clean or dirty scorecard):
1) Your January score - scorecard and baseline score impact shift
2) What Fico model you are referring to. Fico 8 does not care much about # cards reporting but, Fico mortgage models do.
3) What CRA you are interested in. Experian does not penalize much for high # cards reporting regardless of Fico model. Equifax punishes the most, particularly on Fico 04 (score 5)
4) You mentioned your highest individual card utilizations being in the 80s and even higher. However, you failed to mention highest utilization on a card after paydown. Fico looks at highest individual card utilization as a scoring factor.
5) Do you have derogs? Dirty scorecards react much less strongly to changes in # of cards reporting and utilization than clean scorecards.
6) Your scores pre-paydown.
For a clean scorecard assuming highest individual card UT is under 50% but above 30%.
1. Reducing AG UT from 74% to 11% should be good for 40 to 50 points on all 3 CRAs
2. Reducing highest card from above 90% (max out territory) to under 50% may be worth 15 to 20 points.
- Take off 5 points if highest card was above 80% UT but below 90% max out threshold.
3. Going from 90% cards reporting to under 25% reporting might be worth 10 points on EQ/TU and 5 points on EX
* Total estimated Fico 8 score improvement (clean scorecard) = 65 to 80 points on EQ and 60 to 75 points on EX.
- Note: if your highest individual card is below 30% UT, add an additional 10 points, On the other hand, if highest card remains above 70% UT, deduct 10 points off the estimate.
Estimate of score improvements on a dirty scorecard provided in below post. Note shift in signal strength for scoring factors between clean and dirty scorecards.
Bravo!
Appreciate the break down.😹😺
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