@Anonymous wrote:
@mitchblue wrote:
@Anonymous wrote:
@SouthJamaica wrote:
@Anonymous wrote:
This seems absurd to me. I was a 828 Equifax and added a $3500.00 State Employees Credit union visa credit card last month. Today I get an alert that I have dropped from a 828 to a 807?
It is absurd but
(a) one loses points for the hard inquiry and
(b) one loses points for the lower Average Age of Accounts
I am begining to think its this site and this is how they keep you as customers if they show wild swings in your score? I have never seen anything like it? Your score should not drop 21 points because you open up a credit card. Anyone else feel like this site just leads you on with wild scoring swings to keep you paying for the next ALERT? Who actually owns this site MYFICO anyway? Does anyone know? They make it sound like its a government run entity by there advertising etc: I am frustrated.
Maybe a HP effects the score more the higher your Fico is? Just a guess. And without knowing what his previous, and now new, AAoA is it's hard to determine. And honestly, maybe he missed something that decreased his score some, like his utilization.
Overall UTI is 4% and the credit card opened at $3500.00 with a zero balance.
I guess the first step in the 10 step credit score drop acceptance hierarchy listed below would be to abolish all conspiracy theory thoughts. FICO scores are based on many, many factors which have demonstrated (in the minds of the algorithm inventors and credit issuers at least) some correlation with repayment and default potential.
1. There is no conspiracy - No they don't change your scores to hook you on this site and get subscription fees. I would guess that FICO's revenues from commercial activities are exponentially higher than the subscription fees they earn from us.
2. Given that FICO accepts the algorithm's they have built, you should accept that any activity that the computers feel indicates higher risk should lower your score.
3. Given #2 (note the excellent example a previous poster mentioned about a friend borrowing money from you after arranging another loan elsewhere), seeking credit is generally an indication that you need or plan to need credit shortly.
4. Given #3, someone who needs credit is likely under more financial duress (even if only fractionally) than someone who does not.
5. Given #4 and #2, someone who is under more financial duress should have a lower score than someone who is not.
6. Given #6, by going from someone who was under less financial duress (i.e. not looking for credit) to someone who is under more financal duress (i.e. is looking for credit) your score should drop
7. Given #6 and refer to #2, the amount of the score drop which should now be expected is determined by FICO's internal algorithm.
8. The magnitude of the score drop from a negative change in credit profile is generally larger the higher the credit score initially was. So a new inquiry or account for someone with a 700 score may result in a drop of only a few points or even no drop at all, while for someone with an 800 score it may be 10, 20, or even more points.
9. Chill out, relax, take a deep breath. With time your score will recover.
10. See #9
