Credit score gone down ...

[LuckyTaxi]

It has to be due to me assuming more debt, correct?
My credit cards are as follows.

16,000 limit - $12,000 balance
12,500 limit - $9,000 balance
$7,000 limit - $4,000 balance

Not too worry since most of it is business stuff that will be paid off once we finish rehabbing our properties.
I'm just wondering if this is why my score went from 736 to 676

 

[5LiterMustang]

More than likely that is why, you're using a lot more of your credit which makes you a bigger risk.

 

[Mo0o]

Wow that's alot of credit card debt

 

[ITJunkie]

Originally posted by: 5LiterMustang
More than likely that is why, you're using a lot more of your credit which makes you a bigger risk.

I would agree; having recently paid off some debt and watching my score go up.

 

[royaldank]

If you haven't made any late payments or opened any new accounts, then I'd say it's due to your debt ratio raising.

 

[RagingBITCH]

Um, you have a huge proportion (in comparison to your limit) of revolving debt.

 

[LuckyTaxi]

No worries ... im in the real estate development business and i've been putting stuff on my personal account. once our properties get sold, i put money back onto the card.

 

[iamwiz82]

Originally posted by: royaldank
If you haven't made any late payments or opened any new accounts, then I'd say it's due to your debt ratio raising.

That would be my guess.

 

[conjur]

Your utilization is rather high. Drop it down to about 10-15% and your scores will go back up.

BTW, from where did you get your scores? If it wasn't from http://www.myfico.com then the scores are meaningless.

 

[RossMAN]

High balance to limit ratio's will definitely lower your score.

That's also one of my weaknesses, but slowly I am paying it off.

 

[LuckyTaxi]

Originally posted by: conjur
Your utilization is rather high. Drop it down to about 10-15% and your scores will go back up.

BTW, from where did you get your scores? If it wasn't from http://www.myfico.com then the scores are meaningless.

I'm trying to obtain another $50,000 and had my broker check my credit.
There's A LOT more that i owe but they dont show up on my credit report.
I have about $150k in more debt (hard money lenders and unsecure line of credits).

 

[Vic]

The balances on your revolving debt are 70% of the limits. Having that ratio greater than 50% will lower your credit score significantly even if all your payments are made on time.

 

[CTrain]

Yeah, thats the main reason.
I posted this THREAD about the exact problem.

 

[Vic]

In answer to Ctrain's thread (and what I already posted in that thread), there is nothing wierd about the way the credit scoring system works. Most people just don't understand it. They wrongly think that its purpose to punish people who have made late payments. Not so. No lender on this earth cares about an applicant's past, except insofar as it demonstrates the applicant's character in repaying their debts and/or not taking on more debt that the applicant can handle. But all lenders really care about is whether or not the applicant is going to repay their new loan in the future.
So the purpose of the score is to help the lender determine the applicant's likelihood of defaulting on any new additional debt. "What is that applicant's capacity to take on new debt?" If you are carrying significant balances on your credit card debt, then your capacity is obviously diminished. It is very likely that you already have more debt than you have the capacity to repay and your score will reflect that.

In a nutshell, your credit score represents the mathematical likelihood that you will file for bankruptcy at some point in the future. The lower the score, the higher that likelihood and the sooner it is likely to happen. 676 is not a bad score. Just not a great one either.