check my understanding of fico scoring

[Anonymous]

I want to check if my understanding is correct, by giving a scenario and what I think would happen. If somebody had a poor FICO score because of high balances on revolving credit accounts, but had a great payment history - if that person won the lottery and could instantly pay off those accounts, would there score suddenly skyrocket?

[smallfry]

All things being equal FICO doesn't care what your utilization used to be. So if the accounts were paid down to 1% you should see a large point increase providing the large balances were holding the score down in the first place.

[cobaltnv]

I would add that winning the lottery would only be necessary if the balances were really really high.

The Fico formula does not care about credit card limits only about utilization. For example someone with a $75 balance on a cc with a $100 limit is going to take a bigger score hit than someone with a $2500 balance on a $10,000 limit card. Everything else being equal.

[nothingman02]

Yep. And if you share your lottery money with the first three who replied to your question, it would go even higher.

[Anonymous]

I agree nothinham02 number 3