Examples of what affected credit and how

I just pulled my TrueCredit report today and found that an item had finally dropped off (after 7 years). It affected my Credit Scores exactly 0 (zero).

It was a $341 debt reported as derogatory and and unsatisfied debt. It arose out of a disputed charge by a garbage collector who did not act according to our agreement. I paid them what I owed them and this is what was the difference between that and what they wanted.

Anyway, for those (like me) wondering how things will affect your credit, this is one more situation to add to the list.

For whatever reason, dropping off had no effect. It could be the amount, or the age, or the fact that I still have 5+ derogatories on my report, or a combination of factors specific to my own file.

One other to add while I'm at it is 3 medical accounts which are more recent (2003) that I just recently paid for deletion. A couple of weeks ago, the items showed up as PAID. I confirmed they will be deleted by April 9. Perhaps because they are medical accounts or the factors listed above or that they still show on my report, they affected my credit scores 0 (zero). I will post to this thread when they are deleted to let you know if they affect my score at that time. Once they're gone, my Equifax derogatory accounts will drop to 4 although Experian and TransUnion will remain at 5 or more.

For the prognosticators:

I have a judgment from 2001 that has been paid, but is not reflecting paid status with the bureaus. I've contacted them and it should turn soon.

I have a $262,000 mortgage with the first payment on 2/1/07 that will not show up on my report until April/May according to GMAC.

I have a $42,000 boat loan that will kick in next week when the boat is delivered. It's a joint loan with my brother.

I just got a $4,000 credit limit Home Depot card 2 days ago. (I wouldn't have taken it, but my brother and I are fixing up houses, so it was kind of a necessity. They have 6 mos. no interest on purchase $300+, so it gives me time to sell before I have to pay the bill.)


How do you think these will affect my credit score?

For a brief synopsis of my credit file, I've got balances of less than $2,000 including all credit cards and collection accounts. I've got about 20 accounts on file with about 11 closed (7-9 derogatory) and 9 open. From 4 years ago, EX shows a foreclosure, TU/EQ show 120 days late. And there's the judgment from 2001 that will soon show paid. Most of my open accounts were opened in the last 2-3 years.

MY SCORES - TU=628, EX=637, EQ=656

Look into your crystal balls!

Add your own examples if you'd like. I'd be interested to see what has worked - credit scoring still puzzles me to no end!

 

I'm not sure which is the "heaviest". I'm carrying balances of less than 5% of available credit. My scores would look terrible if I had balances! The foreclosure and judgment have to have an effect, but they're 4 years old, so how much? I know the relatively young age of my open credit lines must have an adverse affect, and their relatively low credit limits has been pointed out by some of the scoring models. I think it was TransUnion or Equifax that pointed out that I needed an installment account because it didn't look like I was 'experienced' enough without it. I know a mortgage can also sometimes help.

 

I am in the process of getting a home equity line of credit, so when the broker pulled my credit, I was surprised to find that his scores were a lot different than my "FAKOs".

I pulled TrueCredit this morning and it had my scores as TU-628, EX-574, EQ-654.

Now, I also pulled Experian's Credit Expert and it said my EX score was actually 637. I've recently pulled my Equifax, and it said I had a 656.

My broker's copy of my credit reports say I have a 668 with EQ, 691 with EX, and 706 with TU. Some difference, huh?

---TrueCredit----Bureau----the Real Thing
EQ---654--------656--------668
EX---574--------637--------691
TU---628--------628--------706

 

LOL - I hear you. I'm going to see what other business I can do with this broker - I like him too!

 

Ok, so I had the 3 paid medical collections to drop off yesterday. One was for $4523, one for $180, and one for $167. You'll see above that they had no effect when they were marked paid a couple of weeks ago.

Today, I pulled my Experian FAKO and 5 things had happened. Those 3 accounts had been deleted, my Home Depot card with a $4000 limit appeared with a $324 balance, and one of my other credit cards with a $1200 limit went from a $0 balance to $300. I normally try to pay them off before the billing cycle so they'll show ZB, but I missed this one. At any rate, my *available* credit dropped from 95% to 90% - still should be just a blip.

My EX Score dropped from 637 to 628.

I pulled my TrueCredit 3 in 1 and TU and EQ aren't reporting any of the changes above so their scores remained the same. TC reports my EX score increasing from 565 to 573!

I guess that's what you get with the FAKOs!

My best guess is that the derogatory items that fell off didn't have much effect because they were medical and they were from 2003 (4 years old). The balance on my existing card probably didn't affect anything because it still didn't breach any bad level of credit usage. I would guess the thing affecting my score the most is the new line of credit with Home Depot - first in that it's a new CL, second in that it reduces the overall average age of accounts (possibly the medical derogs affected that as well).

Here's what's coming up in my credit future still yet to affect my score:

** A Mortgage account for $262,000 (last mort on record was 2003)
** An installment loan for $42,000 (no installment loans on record)
** Working on a HELOC for around $80,000

I'm sure the only thing that will help my score out of the lot is the Mortgage. Well, at least I'm at a point I can 'use' my credit - even if it's not the best!

Some additional information:

Experian's My Plus Score reports the following as one thing that is *helping* my score:

"You have no open installment loans, such as auto loans, on your credit report. This positively influences your credit score because lenders feel you are more likely to pay your other bills without the fixed monthly payment attached to an installment loan. (P-G)"

TransUnion and Equifax on the other hand offer this about installment loans:

"You have not had enough debt experience. [TransUnion, Equifax] A healthy balance of credit and loan accounts is key to achieving a high credit score. It is important to build a record of responsible credit use over time with different types of accounts. Consider opening a new account to strengthen your credit report and improve your score."

I know I need to read "Credit Scoring for Dummies", but isn't that just a little bit of conflicting information?

Additionally, Experian offers this as something that lowers my score:

"Having low credit limits on your accounts and loans is lowering your score. Having a high amount of credit is a positive factor because it indicates to lenders that other creditors have trusted you by lending you money in the past. However, since your major credit card limits are generally low, lenders may think you donâ??t have enough experience with high limits. Keep on minimizing your outstanding debt and pay all your bills on time and some lenders may eventually raise your credit limits, which in turn may help boost your credit score. (N-F)"

Hope this helps someone understand the scoring system just a little better! (It sure doesn't help me!)

 

In pulling my TrueCredit this morning, TU finally dropped the 3 paid medical collections and reported the Home Depot line with one successful month under its belt.

Also, there was one inquiry since the last post (related to my HELOC).

The TU score went from 628 to 639.

TC also reports the EX score as 566 - down from the 573 it had risen to - probably because of the inquiry.

TC reports EQ as 658 which is up from 654.

It's odd that EX's scoring model dropped my score while TU's model raised it for the exact same activity...

 

YIKES! Good Article CCBOB! I was caught up in the Cap1 portion (fought that battle w/ them too) until I kept looking for the SWITCHING SCORECARDS section. This is a must read for all of us trying so desperately to repair our credit!

I've been trying to figure ways to get a foreclosure off my credit, but maybe I should just let "sleeping dogs lie" - according to this article. My scores are 668-691-706, and that's not bad given that I've got a lot of new accounts and a judgment and foreclosure on my CR. I might actually suffer drops in my score as I clean some of these things off.

Some quotes from the article (referenced above, author - Liz Pulliam Weston) that I found pertinent to this thread topic are:

As far as the Capital One cards, my plan was to go out and buy a gift card somewhere I know I'll spend it (Home Depot, for me) for the exact credit limit of the card - thus establishing a "High Limit" at par with the credit limit. My idea of a gift card was to get every last dollar of the Credit Limit without going over and incurring adverse charges.

Read, and be educated!

 

Came across http://www.whatsmyscore.org today. Has a good FICO estimator that gives a 50 point range that your score will be in given the criteria you enter. It was accurate with my info (inasmuch as 50 pts is accurate).

The advantage of a tool like this is you can try some "what if's" to see what action(s) will help (or hurt) your score the most. I was surprised to see that with everything else the same, a foreclosure of less than 1 year caused a drop of 25 points over a foreclosure of 1-3 years. There was no change between 1-3 years and over 3 years. And, it was a gain of 15 points to have no foreclosure vs. one that's 1+ years.

Supposedly, the model is from FICO so it's more accurate. Check it out and see what you think.

 

For those keeping score... (so to speak)

I checked my Experian FAKO (Credit Expert - My Plus Score) and it dropped from a 628 to a 610. Here's what changed:

I have a WaMu card with a $3500 CL. The balance went from $532 to $1817 and the High Balance went from $2692 to $3443 (don't think that makes a difference).

So at $1817, I'm using 51.9% of the card's CL rather than 15.2% previously. Also, Experian is saying I'm using nearly 19% of my available credit now as opposed to about 6% before. According to their "Plus Score Simulator", if I dropped back below 15% credit usage, my score would shoot back up. This card currently has a zero balance, but I didn't get the payment in before the statement went out.

Incidently, TrueCredit's algorithm made no change in my Experian score.

For those looking for loans, keep your credit usage under 15% to get the best out of your score!

 

My judgment from 2001 was just marked satisfied with Experian.

According to their FAKO - no change.