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Whats a better plan for a better score in 10 months

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Anonymous
Not applicable

Whats a better plan for a better score in 10 months

What is a wiser move? Pay of my $10K credit card debt which is 23% utilization rate today or PAY IT OFF slowly throught the next 9 months. What would result in a higher score in 10 months?

Message 1 of 20
19 REPLIES 19
AllZero
Mega Contributor

Re: Whats a better plan for a better score in 10 months

Finances over FICO.

With that in mind, either method will yield the same results score wise if all else remains the same.
Message 2 of 20
dragontears
Senior Contributor

Re: Whats a better plan for a better score in 10 months


@AllZero wrote:
Finances over FICO.

With that in mind, either method will yield the same results score wise if all else remains the same.

+100

Score wise it doesn't matter if you pay it off all at once or over months so best to figure out what is best for your finances 

Message 3 of 20
Nomad3
Frequent Contributor

Re: Whats a better plan for a better score in 10 months

As far as score goes there are two things to consider:

 

1. On Fico8 (and most models) utilization is just a snapshot, so according to the algorithm you will get the same amount of points in the end. Every threshold you cross will give more points.

 

2. On Fico10 they arr using trended data and whether you are PIF or carrying balances will factor into the score (correct me if I'm wrong), so not carrying the balances will probably give you a better score on this model.

 

That said, most lenders still use older models (2/4/5/8), but who knows if they will start using 10 or when.

 

As always though: finances first, fico second

 

Message 4 of 20
dragontears
Senior Contributor

Re: Whats a better plan for a better score in 10 months


@Nomad3 wrote:

As far as score goes there are two things to consider:

 

1. On Fico8 (and most models) utilization is just a snapshot, so according to the algorithm you will get the same amount of points in the end. Every threshold you cross will give more points.

 

2. On Fico10 they arr using trended data and whether you are PIF or carrying balances will factor into the score (correct me if I'm wrong), so not carrying the balances will probably give you a better score on this model.

 

That said, most lenders still use older models (2/4/5/8), but who knows if they will start using 10 or when.

 

As always though: finances first, fico second

 


FICO 10 hasn't even been released yet so no one knows how it will look at this type of situation plus it is always a while after a new scoring model is released before lenders start using it.

Message 5 of 20
FireMedic1
Community Leader
Mega Contributor

Re: Whats a better plan for a better score in 10 months


@dragontears wrote:

@Nomad3 wrote:

As far as score goes there are two things to consider:

 

1. On Fico8 (and most models) utilization is just a snapshot, so according to the algorithm you will get the same amount of points in the end. Every threshold you cross will give more points.

 

2. On Fico10 they arr using trended data and whether you are PIF or carrying balances will factor into the score (correct me if I'm wrong), so not carrying the balances will probably give you a better score on this model.

 

That said, most lenders still use older models (2/4/5/8), but who knows if they will start using 10 or when.

 

As always though: finances first, fico second

 


FICO 10 hasn't even been released yet so no one knows how it will look at this type of situation plus it is always a while after a new scoring model is released before lenders start using it.


+1. FICO 9 isnt even used by all creditors yet. 10 will be 10 yrs away probably. Smiley Very Happy


Message 6 of 20
Anonymous
Not applicable

Re: Whats a better plan for a better score in 10 months

One thing to consider if you're a Synchrony customer is that they use VS4.0, which does incorporate trended data. For that, a one-shot payoff would be better because you more rapidly achieve low usage.

Message 7 of 20
SouthJamaica
Mega Contributor

Re: Whats a better plan for a better score in 10 months


@Anonymous wrote:

What is a wiser move? Pay of my $10K credit card debt which is 23% utilization rate today or PAY IT OFF slowly throught the next 9 months. What would result in a higher score in 10 months?


The sooner you pay it down the sooner your score will rise.

 

There's no premium for paying it off slowly.

 

 


Total revolving limits 741200 (620700 reporting) FICO 8: EQ 701 TU 704 EX 685

Message 8 of 20
Anonymous
Not applicable

Re: Whats a better plan for a better score in 10 months

I just figured credit will see i'm making 10 more months of payments versus not making anymore payments for 10 months becasue I do not have a balance.

Message 9 of 20
SouthJamaica
Mega Contributor

Re: Whats a better plan for a better score in 10 months


@Anonymous wrote:

I just figured credit will see i'm making 10 more months of payments versus not making anymore payments for 10 months becasue I do not have a balance.


It doesn't work that way.


Total revolving limits 741200 (620700 reporting) FICO 8: EQ 701 TU 704 EX 685

Message 10 of 20
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