SCOREWATCH SAYS OPENED NEW ACCOUNT? (Over a year ago!)

[Anonymous]

Hi I'm hoping someone can help me better understand this. I bought Scorewatch here and have had it for almost a year. Since then every 3 months I've been getting the update when my Experian fico score goes up or down and why. Well just yesterday it said my score dropped 8 points, reason because a new account was opened. I freaked because I haven't opened any new accounts in over a year. So I get the scorepoints and check out my report and it says one of my cards was opened 1 year and 1 month ago. NO new accounts other than that. So why on earth is it going down NOW? I don't understand how I've had updates every so often with my score changes and explanations since getting Scorewatch, and then this comes up now? Doesn't make any sense. I worry about identity theft, especially when I see a red flag like this. Does anybody have an explanation or advice for me?

[haulingthescoreup]

Hi, shamrock -- I'm moving your post over to Using myFICO Products, as it involves ScoreWatch. A myFICO admin should catch it there.

BTW, ScoreWatch is Equifax (EQ), not Experian (EX.) Easy to get confused with the high-points Scrabble letters!

[Anonymous]

Hi shamrock007,

I can explain this and you do not need to be worried about identity theft at all with this alert. 

The score alert you received on the 19th was not associated with a credit alert, so what Score Watch does is use the top negative factor as a reason that MAY be why your score dropped, which in your case is this "newly" opened account.  If you read the more detailed explanation below the alert you received on the 19th, in the section titled "Changes to your credit report", you'll get a few more details about what may be causing the drop.  In your case it appears that you have changed categories, so your credit profile is being measured against other similar profiles.  Changing a category might result in a temporary score decrease, but on the plus side it will also accelerate score increases if you continue to maintain your excellent credit history.  If you read the details, it states you may have:

"...moved from one category of credit users to another as time passed. For example, you may have transitioned from the category "consumers with a new credit history" to the category "consumers with a two- to five-year credit history". As a result, your credit report is evaluated differently, causing a slight change in your score. The good news is that moving between categories like this usually offers you the potential to reach a higher FICO^® score in the future"

I know this might seem confusing, but again, no worries about ID Theft.  Since you have such a high score and there was not a credit alert associated with the score alert, Score Watch is basically doing it's best to identify the reason for the drop.  In your case it was a bit misleading as it is not the case that you opened a new account, but that you changed scoring profile categories.

[Anonymous]

Hello, Jen,

Thank you for responding to Shamrock since I have "just" experienced the same problem.  My FICO scores - all 3 -- finally increased and I was so  proud.  Concurrently, I opened a new checking account to move money into so I could pay off 2 collections account and do even better.  I didn't realize the bank would pull all 3 credit reports.  My scores have dropped 60 points on all the credit reports.  I thought is was due to the Inquiry, but as you explain below, it was due to the opened account.  My open issue, Jen, is that I never gave them permission, nor did they ask or did I signoff on pulling my reports.  After complaining to the Bank, they told me it is standard procedure to ensure I will be a worthy customer.

I do believe it makes sense, especially in this nightmarish economy!

Thanks for doing a splendid job and helping me out.

Debbie

[llecs]

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sleeplessoverfico wrote:

Hello, Jen,

Thank you for responding to Shamrock since I have "just" experienced the same problem.  My FICO scores - all 3 -- finally increased and I was so  proud.  Concurrently, I opened a new checking account to move money into so I could pay off 2 collections account and do even better.  I didn't realize the bank would pull all 3 credit reports.  My scores have dropped 60 points on all the credit reports.  I thought is was due to the Inquiry, but as you explain below, it was due to the opened account.  My open issue, Jen, is that I never gave them permission, nor did they ask or did I signoff on pulling my reports.  After complaining to the Bank, they told me it is standard procedure to ensure I will be a worthy customer.

I do believe it makes sense, especially in this nightmarish economy!

Thanks for doing a splendid job and helping me out.

Debbie

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Sorry that happened. Actually, nearly all banks pull at least one credit report now before opening a new account, though all 3 is quite rare. If you don't mind me asking, which bank pulled all 3? I'll certainly avoid them.

The solitary inquiry (one for each CRA) didn't cause a 60 point per CRA. Something else happened. I'd pull your reports and look side-by-side to see what changed. One thing that would cause your scores to drop is paying off your collections. A paid CA is just as bad as an unpaid CA. Most of the time, paying a CA can actually drop your score probably into the double-digits, but not likely by 60 points.