Credit Scores for Debt Free Folks.

Well, I wouldn't say I'm debt free, but I have no credit card or revolving debt. I do have a mortgage, an auto loan, and a student loan. No negative tradelines, no late payments. My scores are around 795-810, depending on the CRA.

Elle

 

Once upon a time I was credit card debt free and my FICO's were 804 TU 788 EXP 812 EQ. I now have about 25K in 0% credit card debt and my scores have fallen to the levels below. But for 0% until December I can live with it.

 

I have recently cleaned up my EX and TU reports. I have revolving accounts on both that, although closed, date back to the late 1980's. I have other seasoned credit accounts that are in reality closed but still say open with zero balances. I actually only have one open account with CAP 1 with a balance of about $100 and a $325 limit. This is my only reporting balance and I always leave a small $15 balance on my card each month.

My EX score is 776 and my TU score is 843 which is a miracle.

I have not pulled my EQ score yet because I still have one closed account with multiple lates that I am in the process of getting deleted.

 

REInvestor...A Few Questions?

Currently, the 25K debt represents about 31% as I have around 80K in credit lines available. I have 16 credit cards and 3 have a balance.

Back in the good old days of being a 800 club member I had 14 credit cards.

I do now and had before 7 mortgages on my personal residence and investment properties.

 

I really don't think it has anything at all to do with percentages in my case. I do leave a very small balance on my account each month vs. paying it off completely. I think that this does help a little. I have six to eight tradelines on both EX and TU.

The one thing that I believe helps the most is that I have a few accounts that are 10+ years old and several that are 5+ years old. Age really makes a big difference.

If you have a relative that has some really old accounts in good standing, you may want to see if they could add you as a co-borrower. Whether the entire history will be reported or not is another question, but you could call the OC to find out how they will report.

 

I've got some good data on this. (Zero debt vs. some)

Experian faco awards the most points for zero debt.
I actually hit 820 (honest!) but they penalized me heavily for slight debt (part of my theory that the model rewards paying down and penalizes adding debt) Just a few K, and I dropped to 787. $7300 took me down to 763. But when I just paid off 4K, I only gained 15 points (778). We'll see what happens when I hit under 1K again.

The real FICO however, does not seem to be tied to amount owing. It is a lot more complicated. I hit 800, but my score actually dropped to 780s before I added debt. (I think they like activity) And then the new debt dropped me another 20 points.

Who knows!! I feel pretty good that I know how to keep my scores above 760 now, but for that lofty 800 club, there are factors I can't calculate.

The real FICO is actually the most difficult one to figure out.

 

I currently have 2 open credit cards, each with a history of 8-9 years. I use them once every 4 months or so for a small purchase, and pay off the balance right away. I use my debit card for just about everything.

Elle

 

Oh, I forgot I also have a retail card at Express. I opened the card to get a discount on a purchase, and have not used it since. They still report to the CRA's every month, even though I haven't used the card in almost 2 years.

I don't think it's necessary to have a lot of credit cards to have a high score. I don't even think using them regularly makes much difference, as long as the credit card company continues to report to the CRA's regularly (which they always have for all my cards). I think the age of the card matters more. Get a card or two that you are happy with, use them sparingly, and just hold onto them.

Elle