Damm, my credit score dropped from 724 to 668 in 1 month.

[MisterMe]

Originally posted by: JackBurton
You know, I know a guy 2 years out of Chapter 7 and his score is ~654. Weird how the scoring works.

Same deal with a guy here at the office. Just did the Bankruptcy thing summer 03 and just recently his score was 680 something...

 

[rufruf44]

Creditnet got plenty of examples with people like that. A couple of years out of bankruptcy, and FICO score already above 700. Messed up system indeed.

 

[Vic]

Originally posted by: CTrain
All based on because my Total Revolving Balances were $3000-4000...now its $15,000-19,999.
This is from that $15,000 total free interest balance transfer(really a cash advance) I took out from Citibank. I post a thread on this a couple of months back.

I didn't realize it would make that big of a difference.

Among many other things, your credit score represents your ability to borrow more money, i.e. to absorb and pay back new debt. What a high credit score really means is that you don't borrow as much as you could. You just borrowed $15k on a revolving account. Your score went down because your ability to borrow and repay even more new debt has reduced. The biggest misconception about credit (and one that is constantly marketed by the car sales industry) is that borrowing more improves your credit. Nothing could be further from the truth.

And yes, I know that the FICO score is really designed to calculate the probability of the consumer declaring bankruptcy, but what is bankruptcy but the inability to repay debts?


edit: gutharius, you have those numbers backwards. Payment history is 35% of your score, and Amounts owed is 30%.

BTW, lenders are very much aware that the credit scoring system (which like underwriting, is constantly evolving) is giving higher scores than it used to. I actually discussed this very subject with a Radian underwriting manager the other day. This is why lenders NEVER rely on credit score alone. If, for example, you had a premier level credit score (720+) but had a late mortgage payment in the last 12 months, you would still be turned down for a premier level mortgage loan that someone with a score as low as 620 score could still possibly get.

 

[toant103]

Originally posted by: gutharius

Originally posted by: DurocShark
<--wishes I could get over 600... Stupid wife not paying the bills again... :|

Same here man Same here. 'cept I did it all to myself, no wife needed. 🙁

can't blame on the wife.

 

[Gibson486]

i'd hate to see my credit score.....i pay everything on time, but i do not pay everything off. Also, this month, i was 2 days late on 2 bills....oops...

 

[Dulanic]

Originally posted by: dullard

Originally posted by: armatron
Anyhow.. so I pay off all but $5 every month

So you pay how many dozens of dollars in interest each month? Capitol One doesn't have control over your credit score. The credit score places could care less if you carry a $5 balance or a $0 balance. If you carry a balance, then every purchase you make will charge you interest from the day you bought it (for most credit cards that is). I can't imagine the amount of money I would lose if I did that.

Plus, your credit report mentions the average daily balance over the last few months. Your average will show you use your credit cards.

Hmmmm he said a $5 balance, at the worst he might pay $1 in intrest a YEAR. But you are correcrt, carrying a balance makes no difference for your score besides credit utilization which is always bad.

 

[Yossarian]

Originally posted by: Dulanic

Originally posted by: dullard

Originally posted by: armatron
Anyhow.. so I pay off all but $5 every month

So you pay how many dozens of dollars in interest each month? Capitol One doesn't have control over your credit score. The credit score places could care less if you carry a $5 balance or a $0 balance. If you carry a balance, then every purchase you make will charge you interest from the day you bought it (for most credit cards that is). I can't imagine the amount of money I would lose if I did that.

Plus, your credit report mentions the average daily balance over the last few months. Your average will show you use your credit cards.

Hmmmm he said a $5 balance, at the worst he might pay $1 in intrest a YEAR. But you are correcrt, carrying a balance makes no difference for your score besides credit utilization which is always bad.

dullard has it right for the bolded part above. basically carrying a balance negates the grace period on new purchases.

 

[Blastomyces]

I pay off all my credit card bills every month, and have $35K in student loans to pay off. I got my first full time job this year at age age 26 and check my credit for the first time last month. My score is 778! I have no idea how it got that high, but killing off credit cards would be a good first step. And take your money out of IMG and get into some mutual funds, ive been pulling 12-15% returns annually each of the last 6 years.

 

[Mo0o]

Does overdrafting factor into your credit score? My dad took some money out of my account for the tuition and he forgot to tell me how much. I paid off my credit card and then realized I had overdrafted. By then it was too late and i had already been docked. =(

 

[spidey07]

Originally posted by: Yossarian

Originally posted by: Dulanic

Originally posted by: dullard

Originally posted by: armatron
Anyhow.. so I pay off all but $5 every month

So you pay how many dozens of dollars in interest each month? Capitol One doesn't have control over your credit score. The credit score places could care less if you carry a $5 balance or a $0 balance. If you carry a balance, then every purchase you make will charge you interest from the day you bought it (for most credit cards that is). I can't imagine the amount of money I would lose if I did that.

Plus, your credit report mentions the average daily balance over the last few months. Your average will show you use your credit cards.

Hmmmm he said a $5 balance, at the worst he might pay $1 in intrest a YEAR. But you are correcrt, carrying a balance makes no difference for your score besides credit utilization which is always bad.

dullard has it right for the bolded part above. basically carrying a balance negates the grace period on new purchases.

what kind of credit card does that!!!!!!!!!!!!!!!!!!!!

 

[Pacfanweb]

Originally posted by: Mo0o
Does overdrafting factor into your credit score? My dad took some money out of my account for the tuition and he forgot to tell me how much. I paid off my credit card and then realized I had overdrafted. By then it was too late and i had already been docked. =(

No, it doesn't hurt, as long as your bill wasn't over 30 days late....that's all that matters. How your balance came to be is irrelevant, whether it's late fees or you running it up yourself.

 

[whistleclient]

Originally posted by: Blastomyces
I pay off all my credit card bills every month, and have $35K in student loans to pay off. I got my first full time job this year at age age 26 and check my credit for the first time last month. My score is 778! I have no idea how it got that high, but killing off credit cards would be a good first step. And take your money out of IMG and get into some mutual funds, ive been pulling 12-15% returns annually each of the last 6 years.

can you recommend a good mutual fund?

 

[ManSnake]

I agree.

 

[CTrain]

Originally posted by: rufruf44

Originally posted by: gutharius

Originally posted by: CTrain
I'll be taking a hit on my credit score for a while then.
If you do a search for the thread a while back, I got an interest free loan from Citibank for $15K and its good forever...only minimum payment require each month.
Its gonna take about 5 yrs to pay off that $15K.

Yeah, that is gonna suck, just hit it as hard are you can and get rid of it ASAP. But take heart 30% of your fico score comes from making ontime payments. So your really not loosing out too much.

Or you can always apply for more CC and push the total available credit upward, so the utilization % is not as bad. Of course providing that you don't get more of those 0% for life BT offer 😀

Trust me I've tried many times.
Its the best CC that I have and I try to get a limit increase every chance I get

As someone said, yeah I increased my revolving balance by $15K.
Its not like I actually did a balance transfer.
Thats what Citibank call it but thye offer it in term of a check and thats what I got a $15K check from them.

Its not like I need good credit now for anything anyway.
If I need a car, I have $15K sitting in the bank 🙂
Its a house that I would worry about.

 

[Blastomyces]

Originally posted by: tangent1138

Originally posted by: Blastomyces
I pay off all my credit card bills every month, and have $35K in student loans to pay off. I got my first full time job this year at age age 26 and check my credit for the first time last month. My score is 778! I have no idea how it got that high, but killing off credit cards would be a good first step. And take your money out of IMG and get into some mutual funds, ive been pulling 12-15% returns annually each of the last 6 years.

can you recommend a good mutual fund?

Fidelity Value has been good to me, its up about 50% in the 3+ years Ive gotten it. There's this fund by Magellan(I forget what it is exactly, but Ill look it up) that's pulled in 10-15% per year over the last 10 years, I was looking at putting something into that for the long term.

 

[Sysbuilder05]

Originally posted by: armatron
I have a revolving balance of $5. When I called capitol one they said that it's good to have *some* balance, just a small amount. It shows you use credit, or something?


Anyhow.. so I pay off all but $5 every month

Bawhahah,yeah...its GOOD for Capitol One. Even though the interest would be small at that low amount multiply it times millions of CO card holders. Pay the damn thing off completely, its not giving you a better credit rating. The fact that you are given credit(through a card) and then paid it down to zero will improve your credit,not keeping small balances.

 

[lobadobadingdong]

assuming you're putting that money into an intrest bearing account for the duration of the 0% intrerest to make money off it, and then pay the CC back 100% before any interest accru's when you pay it back you're credit score should be back to where it was.

 

[Chaotic42]

Where do you find your score at? I got mine a year ago when I opened my bank account. I've taken a small ($1500) loan since then, and I'm going to pay it off after it hits 6 months. Hopefully it will raise me over 825.

 

[FoBoT]

having a decent credit score with a bankruptcy isn't golden. you can/will still get denied for unsecured credit despite a good FICO score due to the bankruptcy

 

[Pacfanweb]

Originally posted by: JackBurton
You know, I know a guy 2 years out of Chapter 7 and his score is ~654. Weird how the scoring works.

Yeah, but his report still shows the bankruptcy, so in his case the score isn't everything lenders will look at.
It will depend on exactly what was included in the bankruptcy.
If it was just credit cards, he's probably okay, but if there was a car or a house, that score won't help out much.

 

[CTrain]

Originally posted by: lobadobadingdong
assuming you're putting that money into an intrest bearing account for the duration of the 0% intrerest to make money off it, and then pay the CC back 100% before any interest accru's when you pay it back you're credit score should be back to where it was.

Yes I'm doing that but I don't have to worry about any interest accruing...the 0% is for the life of the balance 🙂 . All I have to do is pay the minimal balance every month.

 

[CTrain]

Originally posted by: Chaotic42
Where do you find your score at? I got mine a year ago when I opened my bank account. I've taken a small ($1500) loan since then, and I'm going to pay it off after it hits 6 months. Hopefully it will raise me over 825.

My Providian CC provide the score for FREE.