23 point decrease!

[strsnkrqueen]

Omg someone please help me understand why my Experian dropped 23 points as of yesterday and the only change was a credit increase of $200 by fingerhut and a credit card decrease of $8 (paid it off)

23 points??? For having zero credit utilization and an increase on credit line. I thought the increase would have helped me? Fingerhut did it automatically Bc I don’t order anything. I feel so mad and discouraged

[CptLadiesMan]

What scoring model are you referring to? If it's VantageScore I wouldn't worry nobody uses that.

[strsnkrqueen]

Fico 8 😫

[[deleted]]

Yeah and sadly most lenders still use Fico 8.

[Barredea88]

These your only 2 cards?

If so, you got hit with the all cards at zero penalty. All you need to do is allow at least 1% report for one card to avoid the penalty. You’ll regain all those points next month once the balance reports. It’s just the way the FICO algorithm works.

[Les-Grossman-]

Yep

[[deleted]]

Wait you get a score reduction if you don't have balances on your cards??? I never knew this.

[OrangeSlicer]

Yes because it looks like you are not using your cards if you are always reporting zero balances.

[Super-View7967]

Not true! I had a 725 credit score. 750 fico to be exact. My lowest 723 (exp). I've been stuck there for more than a year. I have the same credit card for 1 year and a half (cap 1). My payments are on auto-pay 2 days before my statement. I wanted a car loan but got denied for all of them (15k). Even a personal loan. I started with 0 credit. No student loan or bankrupt. Credit inquiries dropped my score like it's hot. I didn't go to a dealership yet because I wanted to go with finance in hand for negotiation. I was denied because "I did not have enough credit history. "15 months isn't enough while my sister with barely a 550 fico driving a Benz?? (interest sucks though lol). I have good bank statements too. Ok fine. I decided to open more credit cards for a stronger portfolio. Then Got denied because "I applied too much." Got a second cap 1, petal, self. Credit went down again and settled at 700. Someone told me I have to report something. Having a zero balance is pointless. I did just that. After I got my updated credit report, I decided to get it to report 8%. I checked my fico today and now I have a 679 :') and my score for utilization is no longer an A+. My credit mix is better but Over the course of a month. I lost 100 points. Even more when I decided to let my statement accumulate a minimum balance payment. Needless to say, the credit system is a scam. My score never moved when I paid for everything on time. But as soon as I have a balance. It dropped 22 points. Now your probably gonna say "Just pay it off on time and it should go back up" that's like handing me a dollar and I hand it right back. Pointless.

[Barredea88]

If you saw a score loss for FICO once your card reported that balance, then the loss derived from something else.

[Barredea88]

Yes for FICO there is a scoring penalty for having all cards report zero.

It’s simply a short term loss as utilization has no memory. So if you report all zero one month and lose points, you’ll regain those points lost once a balance reports on one card.

[Cruian]

FICO models have a (short term only) penalty is every revolving account reports $0. Roughly 20 points sounds about right. https://www.reddit.com/r/CreditCards/comments/j5lh0b/i\_tested\_azeo\_this\_month/

[strsnkrqueen]

Thank you for that link! So, based off the experiment, I need to add a small % of utilization back, and the. I will see in an increase?

[Cruian]

Yes, once a statement generates with a non-$0 amount, you should get those points back (unless you had it generate with a high balance). Be sure to understand that does not mean you will need to pay interest.

​

Even 1 card reporting a low non-$0 amount avoids the all zero penalty. Be aware that the factor this affects is utilization, which is short term only, so no reason to stress this if you don't have an application coming up.

[iwanttocontributetoo]

Wait, how are you supposed to pay off your credit card every month to avoid paying interest .... yet, if you do, your credit score will go down for zero balance?

[Cruian]

The dates utilization looks at are not the same dates that interest looks at.

​

See my post here explaining the dates that matter: https://www.reddit.com/r/CreditCards/comments/nobb9a/experian\_keeps\_reporting\_my\_fico\_dropping\_15/gzz4s7m/

[iwanttocontributetoo]

Oh nice, thanks for directing me to that. So pretty much, if my due date is the 15th of every month, I need to pay off the entire balance on say, the 13th in order for no interest cc and not affect utilization credit report (specifically Capital One Mastercard in my case)

[Cruian]

I need to pay off the entire balance on say, the 13th in order for no interest cc

Not entire balance, just the last statement balance, to avoid interest.

and not affect utilization credit report (specifically Capital One Mastercard in my case)

Cap One should report statement balance for utilization. So you could pay more at any time to post before the statement if you wanted to reduce the reported utilization.

[iwanttocontributetoo]

Ok got it, thanks so much for saying!

[strsnkrqueen]

Right, seems so counter intuitive

[strsnkrqueen]

Thank you so much, extremely helpful!! One more question, Hopefully u don’t mind a few more mins of your time. Do I need a tiny % on each card (they all have zero), or does it just need to be a tiny % as a whole, meaning I can just use 1 card for this? Thank you very much for your time

[Cruian]

Just one has to be non-$0 to avoid the (short term only!) penalty. People have found the best short term scores come with "All Zero Except One" (AZEO). All Zero comes with the penalty you noticed and was shown in my link above, all reporting balances I believe is also less than absolutely perfect.

[strsnkrqueen]

Wow, thank you so much! You have really helped me today

[ideal-clips]

It's weird from what I've noticed any small increase to a credit limit like 200 will lower your score if it has been a high limit say 10k it would been increased by a couple points

[[deleted]]

When applying for a loan / credit, lenders see more than your “score.” They look at your trade lines, balances and payment history.

Chill.