Decided to try and improve my credit.
Phone app (correctly) stated I had high credit card utilization.
So I focus fired two of them down completely.
Those changes finally showed up on my report today.
The damn score went DOWN 23 points.

It's true. Credit score math is black magic.

Credit should be used as a tool, not played as a video game.

Did you just pay the card balances to zero, or did you close the accounts too? The first part is good; the second part not so much.

Part of your credit score is length of credit history. If you close a long-standing credit account, like a credit card that you've had for many years, then your score will take a noticeable hit.

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So I focus fired two of them down completely.

I assume this means you paid them off? Did you close the accounts afterwards?

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Originally posted by egregore:

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So I focus fired two of them down completely.

I assume this means you paid them off? Did you close the accounts afterwards?

Nope - all I did was pay them off.
The cards are still active.

I could see the score dip if I had closed them - cuz then that's loss of credit age & number of accounts.

Give it a cycle and you will get a boost.

Also, never use more than 30% of the credit limit.

They don't want you to pay them off, that's why the score goes down. They want you deeply vested in the game. Lots of credit "usage" gets you a good score. It's not a "credit" score. It's a how much can I borrow and pay back according to their terms score. The more interest they collect from you without sending you to bankruptcy the better your credit score will be. It has nothing to do with worth, net worth, wealth, financial stability or anything of value. It's only a score of their ability to collect interest from you.

Your credit number is more a of range than a specific number.
Moving up and down a bit isn’t so important, it just needs to be in the excellent credit range. Mid 700’s or above.

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Originally posted by 220-9er:
Your credit number is more a of range than a specific number.
Moving up and down a bit isn’t so important, it just needs to be in the excellent credit range. Mid 700’s or above.

Absolutely excellent advice. A friend of mine was whining about his credit score dropping something like 20 points....from 830 to 810. I told him the drop meant absolutely nothing to a lender, he'd still get their best credit offer. If you're north of 700-750 and have been there for quite some time, you're good to go. If you're north of 800, lenders will be thrilled to put you at the front of their line and offer you the best products they have.

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Originally posted by bigdeal:
If you're north of 800, lenders will be thrilled to put you at the front of their line and offer you the best products they have.

Truth.

During my divorce and purchase of a new house in the early part of the pandemic in 2020, I had mortgage lenders fighting to try to get my business.

My soon-to-be-ex-wife, on the other hand, could hardly get them to respond to her, and they were offering her significantly higher rates compared to me.

The difference was that I had a credit score in the mid-800s, while she had a credit score in the mid-600s.

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Originally posted by 220-9er:
it just needs to be in the excellent credit range. Mid 700’s or above.

Which is where I'm trying to get to.
Which is why I paid these things off.
But it instead went the opposite direction

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Originally posted by creslin:

quote:

Originally posted by 220-9er:
it just needs to be in the excellent credit range. Mid 700’s or above.

Which is where I'm trying to get to.
Which is why I paid these things off.
But it instead went the opposite direction

If that’s all you did, give it a month or two and it’ll get better. As mentioned, don’t close the accounts when you pay them off, just don’t use them and have a balance.
None of our business but we’d need to know the rest of the story to accurately say what’s next. In any case, just keep that up and the number will continue to go in the right direction.

My score fluctuates between 725 and 750. But I quit worrying about my credit score shortly after I made some really bad mistakes and had to file for bankruptcy. After the discharge hearing, in the hallway outside the hearing room, two different credit card representatives offered me new cards. Why? Because I couldnt file bankruptcy again for 7 years. I declined the offers but the whole thing was an eye opener.

quote:

Originally posted by creslin:

quote:

Originally posted by 220-9er:
it just needs to be in the excellent credit range. Mid 700’s or above.

Which is where I'm trying to get to.
Which is why I paid these things off.
But it instead went the opposite direction

Utilization is reported on a randomly assigned day during the month.

You may very well have payed down your credit balance to zero, but it might not have been reported as such.

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Originally posted by jeffxjet: The more interest they collect from you without sending you to bankruptcy the better your credit score will be.

They don't collect a dime of interest from me and my FICO is north of 800.

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Originally posted by Rick Lee:

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Originally posted by jeffxjet: The more interest they collect from you without sending you to bankruptcy the better your credit score will be.

They don't collect a dime of interest from me and my FICO is north of 800.

Ditto.

My credit score is currently around 820, down from a height of 839 a few years back.

I've only ever had two credit cards, both of which get paid off every single month, so never accrue any interest. (I actually only really utilize one of them, with the other being my first credit card I got at age 18, which I use for one small transaction a month just to keep my longest-standing credit account active.) It also helps that one credit card has a $10k limit and the other has a $30k limit, but I only put ~$15 and ~$800 respectively on each in a month, thus keeping my total credit utilization ratio very low.

I partially financed one car previously at 0.99%, which I paid off a few years early. Every other car has been purchased outright.

I had a super low interest federal student loan (I don't recall the exact rate), which I paid off early.

The only interest being charged to me currently is the 2.25% on the mortgage, and I'm on track to pay that off 15 years early.


So no, spending a lot on interest isn't the key to having a high credit score. The key is having a handful of long-running credit accounts to show a lengthy history of good credit, only using a small fraction of the total amount of credit available to you, and simply paying all your bills on time and in full.

It ain't rocket surgery, or voodoo, or some secret formula to which only the rich and powerful are privy.

quote:

Originally posted by Rick Lee:

quote:

Originally posted by jeffxjet: The more interest they collect from you without sending you to bankruptcy the better your credit score will be.

They don't collect a dime of interest from me and my FICO is north of 800.

Count me in on team "Good credit, no downsides."

Creditors make plenty of money on controlling the credit infrastructure, so they don't need you to pay interest--they just need you to not default.

The banks make even more when you finance your purchases by running a balance but they still make money from me, paying it completely each month.
Part of the reason for the high interest is to offset the high default rate of people that let their balance overwhelm them and go belly up, leaving the banks to eat that with few assets to collect on.
In any case, you can still have an over 800 FICO score without owing anything and just paying as needed. With that you won't have any problem getting credit that matches up with your ability to pay it off.