Credit Score in free fall?

Discussion in 'General Discussion | Credit Cards' started by youpaiyou, Feb 7, 2013.  |  Print Topic

  1. youpaiyou

    youpaiyou Silver Member

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    Hello:

    In February-August 2012, I started this hobby of collecting points & miles. Without doing a ton of research I applied for the following CCs within that span of time:

    1). Chase Saphire Preferred,
    2). US Airways Barclay,
    3). AMEX PR Gold,
    4). AMEX HH, and
    5). Chase United Explorer Card.

    The only other CC I own and have owned for 20 years is a USAA MasterCard. I haven't canceled any CCs. I have however become prequalified to purchase a home (FYI: I did not anticipate buying a home until December 2012). The above is all of the hard pulls that I am aware of since last February.

    I created this thread because credit sesame shows that my credit score has gone from an 825 to a 786 since February 2012 and I'm curious if this is normal? It seems extreme to me. Also, there is no sign that my credit score is done falling, which concerns me.

    I'm obviously still a newb, but I'm trying to learn from my mistakes. Any input and help is appreciated.
     
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  2. edekba

    edekba Gold Member

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    have you pulled your credit report & look for anomalies? Are you carrying a large balance on the credit cards? Do you use another service (creditkarma) to verify this drop?

    In my case, my credit score has only gone up in the long run ... sure it takes a dip when I apply for cards but usually within 6 months I am at the same score as before if not higher.
     
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  3. miles and smiles
    Original Member

    miles and smiles Gold Member

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    I would NOT rely on Credit Sesame. It doesn't necessarily provide an accurate score. It's always much better to get your actual scores from the three agencies.
     
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  4. edekba

    edekba Gold Member

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    thought it might not be "accurate" as in the score that a lender will pull, it does help provide data points for the movements of your score.

    example: applying for new lines of credit drops your score a bit, but then in time it actually increases.
     
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  5. servo

    servo Silver Member

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    Using the USAA credit monitoring service that checks all 3 scores, my scores are pretty much exactly the same now (761 - after opening 9 new cards since August) as it was at this time last year, before I got started with this stuff. The exception was with my Equifax score, which strangely doesn't show my closed mortgage from 2006, when the other 2 bureaus do have that - and that's the difference in my scores, or so it appears.
     
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  6. kyunbit
    Original Member

    kyunbit Silver Member

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    786 on credit sesame is still a good score. You will recover in a few months, give it time,.
     
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  7. flightnurse

    flightnurse Silver Member

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    Are you Carrying a balance on these CC ?
     
  8. paladin87
    Original Member

    paladin87 Silver Member

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    Well, a credit pull can drop you by as much as 3-5 points per pull theoretically, and a ton of new accounts brings your average account age way down, especially if you don't have a lot of other older accounts. So 5 new pulls and 5 brand new accounts, especially when you only have 1 other existing account, could have a major impact. If you are carrying a large balance on those as well, that would impact it.
     
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  9. foxberg

    foxberg Gold Member

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  10. youpaiyou

    youpaiyou Silver Member

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    Thanks for the replies everyone. To answer a few questions:

    1). No, I never carry a balance. In fact, I pay my balances off in full biweekly.
    2). No, I haven't checked my scores through another medium, e.g., credit karma. I'll do that ASAP.



    786 may be a good score, but what's my score going to be like in a month or so if this free fall continues.... Also, I had intended to start churning after I buy a home.... That just doesn't seem realistic with results like this....
     
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  11. foxberg

    foxberg Gold Member

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    Mortgage will help your credit score.
     
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  12. miles and smiles
    Original Member

    miles and smiles Gold Member

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    Credit scores go up and down all the time. Don't assume that yours will continue to go down. Credit Sesame only shows an estimate of Experian. Credit Karma only shows an estimate of Transunion. Don't rely totally on either one.

    Besides checking your scores, also check your credit report. You can get a free report every year (comes without your scores, but allows you to make sure that your report is accurate) here:
    https://www.annualcreditreport.com/cra/index.jsp

    For a very comprehensive listing of credit monitoring services, look here:
    http://ficoforums.myfico.com/t5/Gen...edit-Monitoring-Service-CMS-Guide/td-p/662549

    My advice is to check your credit report and get an accurate credit score from all three agencies annually. Many of the credit monitoring services allow a free trial offer of a week which will allow you to get your real scores.
     
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  13. youpaiyou

    youpaiyou Silver Member

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    Thanks again for the help everyone. I received my free credit report earlier this year, but I will likey pay to see it again and my scores if my score doesn't plateau very soon.

    FYI: credit karma says my score is 757. Ouch!
     
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  14. RedBarron

    RedBarron Active Member

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    A couple of thoughts. First, at some point in your mortgage process the lender will pull your credit reports. You should receive a notification of this AND you should receive a summary that lists your actual credit scores. If you do not receive this, ask the lender.

    Second, you will likely have to explain each credit inquiry to the lender. For this, you want to be very narrow in your descriptions. Explain why you needed each card and avoid broad statements such as "I started a new miles chasing hobby" or "the cards were great deals." I'd be happy to post a couple of suggestions (I just refi'd with a few inquiries) if needed.
     
  15. StartInSanDiego

    StartInSanDiego Silver Member

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    My husband and I are also experiencing the shock of credit score reduction. We were both in the low 800"s... 20+ years of history, never a late payment, etc. I started really using my main credit card, running up the balance and paying it off. Our first big hit was with this high utilization, my score dropped about 20 points. So I started paying the cards off before the statement ends, this definitely helped when the monthly reporting rolled in. Then, I did an app-o-rama and a solo card each for my husband and I since last July. We also took advantage of a 0% cc loan, AND Chase pulled some credit from that credit line to our new CC, furthering increasing the utilization on that one card. His score dropped from 807 to 729. Holy TOLEDO!!! Mine dropped from 802 to 749.

    So, both of us have lost more than 50 points as of this moment. Mine has gone up, then down, then a little up, more down, etc. I'm hoping his starts to creep back up as mine did. But, all in all, it's sobering to realize how drastically the scores can bounce. We just got funded on a loan today, and the underwriter was not pleased with three new lines of credit (miles CC's recently opened) and the huge credit score drop put us in a different interest rate tier. My bad, I know, for not waiting on the card apps, but the loan was just dragging out and I got impatient, and I was reassured by the oft-mentioned "3-5 points per app" hit that I was expecting. Nothing prepared me for a 77 point drop! Yes, it is a combo of the new apps, the new 0% loan, the moved around credit lines, etc, but that is a big BIG whammy.

    I have been using Myfico's scorewatch (about $15 a month) just to track things officially.
     
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  16. Sweet Willie
    Original Member

    Sweet Willie Gold Member

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    word to all.

    Make sure you know what "score" you are looking at. Most monitoring services are using a score(s) that are NOT score(s) a lender will look at. The monitoring score(s) don't mean squat to a lender.

    99.9% of lenders utilize some form of a FICO score. If truly concerned w/one's score (BECAUSE you are applying for credit), FICO is what you should look at.

    The other scores are fine for basic tracking of one's credit worthiness but shouldn't be relied upon for trying to determine lending.
     
  17. Deal2020

    Deal2020 Silver Member

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    Great info. I usually use at least 3 cards the same time so I do not get close to my credit limit for any of my card. I very rarely do balance transfers because if you do that you would carry a big balance for a long time.
     
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  18. Kalboz
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    Kalboz Gold Member

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    Even if it's accurate (as Credit Sesame informed you), I would not call going from 825 to 786 a free fall. According to my banker, if your FICO score is 750 or higher, you will simply get the best rate, period! Then there is the FICO score of 700-750 range, lower than 700, etc. So, you are sitting pretty and in a good posture for a home loan. I'd get a free 10-days introductory subscription to FICO and get the real score.
     
  19. euromannn
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    euromannn Gold Member

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    Kalboz,
    Credit scores have now caused rate increases in multiple areas:
    Bank loan
    Car insurance
    Property insurance
    Job Applications
    Security Bakcground Checks


    Thus a drop from 825 to 760 remains border line good...but 750 is going to be painful with rate increases.
     
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  20. euromannn
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    euromannn Gold Member

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    Greetings Sweetness,
    When looking at the score are you referring to those honeys' you roam with during the SuperBowl festivities?
     
  21. euromannn
    Original Member

    euromannn Gold Member

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    Credit Score data:
    1. Pay off all credit cards monthly
    2. Credit Card Usage should 7-10%
    3. Do not allow disputed credit card charges to linger more than 30 days.
    4. Do not acquire too much credit.
    5. FairIssac will never, ever, release proprietary data on it's software model so NOBODY knows how to achieve the best credit score. Only approximate what might be the best method to get there.
     
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  22. pilotb757

    pilotb757 Silver Member

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    Correct , it is not a contest , anything 750 and over is all the same.
     
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  23. pilotb757

    pilotb757 Silver Member

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    In my opinion everything in moderation is best. A few cards a year is OK, but some way over do it. I only apply for cards that i only need and will be doing heavy business and personal spending on and will want to keep, I never apply for a card just because of a bonus if ill have no use for the card.
    .
     
  24. youpaiyou

    youpaiyou Silver Member

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    With all due respect, I totally disagree. Bloggers always say applying for a cc will take one's score down a few points. My score certainly went down more than a few points. As a result, I'm reluctant to churn. I'm also curious when it will stop going down. If it's not a "free fall," what is it?

    In regards to my credit score still being excellent, that's not comforting because it still appears to be going down.

    I plan on taking your advice regarding getting my actual score. I'll update this thread thereafter.
     
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  25. jetsfan
    Original Member

    jetsfan Silver Member

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    It's likely your average age of accounts went down. Also, unless you pay off your credit cards before the statement period ends (your statement balance is always 0) your scores will fluctuate from month to month. Depending on how much you're spending compared to your credit line, the fluctuation could be substantial.
     
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