expected drop from new accounts

[Anonymous]

One of the things my discover scorecard said this morning that affects my score under the negative is few accounts paid on time. That is with 3 revolvers and 1 loan. So hopefully that will show up on the positives after the other 3 start showing up.

[Anonymous]

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@AnonymousOne of the things my discover scorecard said this morning that affects my score under the negative is few accounts paid on time. That is with 3 revolvers and 1 loan. So hopefully that will show up on the positives after the other 3 start showing up.

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It won't make a difference.  Few accounts paid on time basically just suggests the presence of a negative payment history item on your CR somewhere.  As I stated in my previous post, percentage of accounts paid on time (or not paid on time) is not a factor here.  If you have 1 negative account and 3 positive accounts, with respect to FICO scoring it's not going to matter if you add 3 more accounts and those are paid on time as well.  That one negative item will equally [adversely] impact your FICO scores. 

I had 10+ open accounts and 20+ total accounts on my CR and with just 1 late payment on 1 account I received the same negative reason statement that you referenced above.  That's enough evidence for me to prove that more accounts isn't going to matter.

Mind you, that's FICO scoring.  Under a manual review, I would think a human being seeing that you were late on 1 out of 4 accounts would be a little more uneasy than the same human being seeing that you were late on 1 out of 7 accounts... but you never know.

[Anonymous]

@BBS

That's what I always thought as well on the 33%.
3 cards or more, 33 % have a balance.
I have 8 revolvers, 2 can have a small balance, no change. As soon as the third one even has a couple bucks on it, and it reports... I see a 7 to 10 point drop (specific to my profile).
Overstock balance went from 0 to 253 (7200 line), cost me 8 points when they reported early (had not used in 6 months).
I've seen this a few times as I went from 3 to 8 cards over 2 years.

AZeO really is not specific to 3 cards, its 33% of cards I believe.

[HeavenOhio]

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@Anonymous wrote:
AZeO really is not specific to 3 cards, its 33% of cards I believe.

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It can vary by profile. Equifax dings me when two cards report positive balances. That's two of five, two of six, two of seven, and two of eight. TU dings me at two of five or three of six. Experian may allow me three of six without a ding, but I can't be sure of that.

If someone asks about getting the best score possible, such as when it's time for a mortgage, the safest route is to recommend all zero except one with the one card having a tiny balance (at least $5 but not much more than that). If someone asks specifically about how scoring works, then the appropriate answer becomes 8.9% of one's total limit and no more than 29% on an individual card — with the qualification that some have seen dings at lower numbers.

[Anonymous]

Guys above, both of you were talking in terms of number/percentage of cards with balances... not total accounts.  Do either of you have an open installment loan or loans?  If so, those by definition are accounts with balances, so any percentage such as 33% would be arrived at quicker than originally thought when considering only revolvers.  I have an open installment loan, so when I'm at AZEO (with respect to revolvers) I'm really at AZE2.  The FICO score changes that I've seen have always been based on my number/percentage of accounts with a balance, not just cards.  This is something that should be considered if you have open non-revolving accounts.

[HeavenOhio]

No loans. I have six cards that report to all three bureaus and a gas/electric account which reports to TransUnion and Experian. But it's Equifax — which has nothing but cards — that's affected the soonest when additional cards report positive balances.

[Revelate]

For FICO 8 I do not believe installment loans are counted; actually I think the reason code might explicitly state revolving trade lines.

FICO 04 I am far less certain about or it uses different percentages or absolute counts like TT has suggested.

[Anonymous]

I'm referring to the reason statement regarding too many accounts with a balance.  I'm quite sure this means both revolving accounts and non-revolving accounts.

See the image below from when I did my test in going to all cards with balances back down to AZEO and AZ.  Look at my Equifax score.  My EQ score took the first hit at 38% of accounts with balances (3 of 8).  One of those accounts however is an installment loan, so only 2 of 7 revolvers (29%) had a balance at the time.