Banks and their FICO score ratings are ridiculous.

[John Schmidt]

I deal with three different banking institutions and have three different FICO scores. All are well above 800 but they go up & down almost at will. My own credit union where I bank just showed mine went down one point from July which is nonsense. I had an unsecured note originally for $10k and last month paid off the remaining balance of approx. $2800, paid off well under three years. Paid off a CC with a another institution with a fairly small balance, also done last month. FICO with them went up a point, but with my own credit union it went down a point. Plus, the end of July my State of Florida pension went up $143/month. Overall, my debt to income ratio is much better so I'm having difficulty figuring out why. The third institution I use is a CU I've been a member of since 1975 and that FICO hasn't changed at all, plus they also give me a no perks CC for 6%. I keep telling Nancy she's paying for all those perks in her high interest CC(17.9% with a FICO over 800) although she usually pays it off each month anyway. But, on our Inzane trip over two weeks she racked up a good balance so some got carried over for a couple months. Yet she thinks she's getting a good deal because of the cash perks. Oh well, it's her business.

I'd just like to know how/why the score goes down when the figures look better.  Income is up, savings in the teens and growing, debts are down substantially, no glitches on any of the accounts...so what gives? I'd sure like to see which coin they're flipping! 

[Jess from VA]

I'm no expert, but I think those things are run on pure computer algorithms (with no individual human consideration).  However it is programed, so goes your score. 

I paid my last loan off (house) 8 years ago.  Churn a card, but paid in full monthly (over 20 years).  Because I have no debt, I probably have a mediocre credit rating.  I don't care, I won't borrow again.

Banks suck.  I only do business with credit unions.   

[bassman]

Interesting article in Consumer Report from 2020....


https://www.consumerreports.org/credit-scores-reports/changes-in-fico-credit-scoring/

[f6john]

I get a monthly report from one of my banks and it even breaks down the changes. Some months you are dinged for not having enough credit outstanding! I find very little of their process that makes sense for people with very low or no debt.

[Serk]

I found it interesting that when I paid a car note off early, that LOWERED my credit score...

...makes sense to someone I 'spose...

[0leman]

MY DW and I have compared our credit scores.  She has a higher score, a lot higher.   I find it funny as was the one who made the most money.  BUT a lot of the cards and bank account were in her name.  Well, our names are on all of them, but her name is first.  I have recently acquired two new credit cards in my name.  We are doing away our debit cards after mine was "hacked" twice in one year.  One card is only a $1K the other is $10K.  Funny how one decides that I should have a lesser amount then the other. We go online and pay off the cards before the due date.  Sometimes couple times a month. Wonder how that affects the credit score.

I haven't checked our credit scores recently.

[bassman]

https://www.myfico.com/credit-education/whats-in-your-credit-score

[Valkorado]

For a po' boy, I try to keep good credit.  Lesson I learned from the school of hard knocks, I guess.  Pay in full, pay early, blah, blah, blah.  I hope to never use the credit for luxury I can not afford, but it's good to have it up above 800 just in case.

BTW, I just won't use online banking at all.  It scares the crap out of me, really.  Too many unsavory characters fishing around for your numbers, and it's gonna get worse.  Always best to go the credit card route (as opposed to debit) because you are better protected against fraud.  Anonymous payments like PayPal (I know some hate them, there are others) are advisable.  And VPN, etc..

I also have locked the big three credit bureaus.  A PIA at times, but I don't need to get at my credit much and I don't want anybody else to.  Call me paranoid and miserly.  You'd be correct.

[The emperor has no clothes]

Don’t know my credit rating, and don’t care. All my debts have been long paid off. And I don’t need any more.

[Bret SD]

My credit rating is low.. because I don't participate. I owe nobody money, and borrow nothing.

Banksters can KMA.

[MarkT]

Ditto.  I have no debt, haven't for years.  Have plenty of savings.  Don't know my FICO rating and don't need it.  Found negotiating on our RV, the dealer would only drop to my price if I financed it - when I walked in and said I was going to write them a check for the RV - don't want or need a loan.  They wanted to make money off the bank loan, instead of the margin between buy & sell.  We finagled that as my wife has a high rating but is retired so no income.  I have income but no FICO rating with no debt for years.  However due to Bidenomics, they are desperate for sales. They got a bank to back us up - said "OK, you can pay it off, all but the last 5 payments" and they will meet my price.  That for a note set up with 180 payments at 7 1/2% interest - 15 years - that added up to about $25,000 in interest if paid on schedule.  So I paid all but 5 payments so we paid little interest and they basically scammed the bank for their margin.  Crooked outfit, with horrible customer reviews on yelp and elsewhere.  All reviews except a couple - which I suspect are fraudulent, from them - saying stay away, they are crooked and piss-poor with service, not keeping their word, basically every aspect of their operation.  We discovered these reviews as we were closing the deal.  Co. Springs dealer. They were just acquired by Blue Compass RVs.  Beware.  We have insulated ourselves from their malfeasance; will go to Blue Compass not them if we need warranty or other service.

[old2soon]

     I am DEBT FREE! Took way too long fer that to transpire. Bank wants to increase the limit on my CC and I keep tellin em NONONO! ANY issue and I MEAN ANY issue I've ever had with my debit card has been handled intrenally by my bank-U S Bank-and so far I have NOT been the one at fault. I'd rather NOT take on Any debt ever again BUT who knows WHAT tommorrow may bring? RIDE SAFE.

[Savago]

The way I see it, the more in debt you are, the higher your score as long as you are paying all the installments when it is due.

The system operates towards pushing people to be in constant debt, being financially responsible and debt free goes against the interests of both the Banks and the government.

Pay all your debts and your FICO score will be penalized.

[old2soon]

The way I see it, the more in debt you are, the higher your score as long as you are paying all the installments when it is due.

The system operates towards pushing people to be in constant debt, being financially responsible and debt free goes against the interests of both the Banks and the government.

Pay all your debts and your FICO score will be penalized.

           so as a W A G no good deed goes unpunished??  RIDE SAFE.

[Serk]

Pay all your debts and your FICO score will be penalized.

I've seen the opposite... A few years ago I paid off over $120,000 in credit card debt in one fell (And painful) step.

My FICO went up several hundred points in a 3 month span after.

Recently we've had some tough times, and had run up almost $30k in credit card debt.

Just recently I was able to pay that off in one fell swoop, and my FICO went from high 700/low 800's to 850 within a month...

Their algorithms have a lot of.... interesting peculiarities...

(It'd never make it business wise but I'd love to see an open source credit rating system!)

[hubcapsc]

It'd never make it business wise but I'd love to see an open source credit rating system!

Sounds like something they'd do at X...

-Mike

[F6Dave]

Even if you don't care about your credit score, a significant drop could be a red flag. That could indicate a credit check was run, or even worse a loan or financial account was opened in your name. In that case I'd go to the website for one of the 3 reporting agencies and run a full report. It's free, and will show your credit checks, loans, credit cards, and mortgages, even those closed years ago.

I recently discovered that if you have a Visa card, one of the free benefits is a basic LifeLock account. If you sign up you'll get a text or email immediately if a credit check is run or an account is opened.

[Serk]

Also..... right or wrong, your credit score impacts your insurance rates, and who knows what else.....

[cookiedough]

ours guessing around 800 or so, good enough for us.   We have autopay on our 2 CC's and payoff bills monthly as well.  Does it really matter if it goes up or down 50 points or so since you are debt free?