FICO score

[Helen]

I am thinking of buying a house in the next year or so. If I buy a new house, my plan is to take out a short term mortgage on the new house and sell the current house once I've moved. Once the current house sells I will use the proceeds to pay down the mortgage or hopefully pay it off in full.

Today I ordered a FICO score from Experian. I expected I would rank in the highest category. Instead it returned a score of 825 out of 990 giving me a B rating.

My file contains the following:

Credit Items:

VISA

$8,500 limit. One 30 days past due (I was late by a few days about four or five years ago). High balance $5,716 recent balance $2,698. I pay this card off monthly and charge most living expenses on it for the frequent flyer miles and to keep track of my spending. Date opened 01/1990

Macy's credit card

$500 limit. Open, never late. Opened 06/2006. High balance $364 Recent Balance $0.

Mortgage

Original amount $87,500. Paid, closed/never late Date opened 09/1993 Last reported 08/2005.

Car loan

Bank of America. Original Amount $5,062. Paid, closed/never late. Date Opened 09/1993. Last reported 11/1997.

Car loan

American Honda Finance. Original Amount $10,644. Paid, closed/never late. Date opened 08/2003. Last reported 10/2004.

So, I've paid off a house and two cars early and have had the same credit card for 17 years.

I'm puzzled why my score isn't higher. The one 30 day late can't be dinging me that much. The only thing I can think of to raise the score is to increase my VISA limit.

Does anyone have any ideas as to how I can raise this score ?

I would think the fact that we have no debt and a fairly high gross income would help us with the loan rate, is this correct ? Any idea how big of a deal my "B" rating is in the big picture of getting a loan ?

Thanks,

-helen

 

[brewer12345]

I would ask the bank to bump your CC limit, but otherwise don't sweat it. Your score is more than adequate to get the best mortgage rates.

FWIW, I saw an article a while back that indicated a large chunk of those with the very highest credit scores were dead.

 

[WM]

Hmmm, no, I was going to say try raising the limit on your credit card, but I don't know how much difference that will make.

DH and I bought a house 6 months ago with, I think, slightly lower scores, and we still qualified for the lowest advertised mortgage rates with our credit union, no extra documentation or hassle.

 

[Helen]

FWIW, I saw an article a while back that indicated a large chunk of those with the very highest credit scores were dead.

Oh crap. I don't like that option.

 

[Corporateburnout]

I was under the impression that the highest score is 850.... Maybe things have changed recently.

Based on your score you will still get the best offers from lenders as it is considered above average.

 

[brewer12345]

Oh crap. I don't like that option.

Yeah, but lenders just want to see that you are over the line. They don't care by how much. Your score is more than adequate.

 

[Goonie]

I was under the impression that the highest score is 850.... Maybe things have changed recently.

Based on your score you will still get the best offers from lenders as it is considered above average.

The top FICO score is 850. However, what you get from any of the three credit bureaus is a "credit score" not a "FICO" score. The "credit" scores' use a different range of numbers.

To get your FICO score, go to http://www.myfico.com

 

[Bikerdude]

I was under the impression that the highest score is 850.... Maybe things have changed recently.

I also thought 850 was the top score.

 

[Goonie]

Just a quick footnote to my post a few minutes ago:

I check up on my credit report at the minimum 3 times a year (one report each quarter), using http://annualcreditreport.com . And usually I check my FICO score about twice a year (mostly for "sh*ts & giggles"....and bragging rights amongst my financially feeble co-w*rkers....yes, I'm an a**hole!!).

 

[Helen]

The top FICO score is 850. However, what you get from any of the three credit bureaus is a "credit score" not a "FICO" score. The "credit" scores' use a different range of numbers.

To get your FICO score, go to http://www.myfico.com

I checked the site out early, but I don't see where I can buy just the FICO score. The closes I found is the FICO Standard. This is what it says:

"*About FICO scores and credit reports
FICO scores are the credit scores most lenders use to determine your credit risk. You have three FICO scores, one for each of the three credit bureaus – Experian, TransUnion, and Equifax. Each FICO score is based on the information that each credit bureau keeps on file about you. As the information in each of your credit reports change, your credit scores tend to change as well. When you purchase your FICO scores and credit reports, you are getting a snapshot that is accurate at the time of your purchase. However, it’s important to note that as the information in your credit reports changes, your FICO scores can also change. That’s why we recommend checking all three of your FICO scores and credit reports regularly - at least once a year."

They want $15.95 for the credit report and "FICO" score from each reporting agency. It sounds like the same thing I can get for $5.95 since the credit report is free.

 

[Goonie]

I checked the site out early, but I don't see where I can buy just the FICO score. The closes I found is the FICO Standard.
They want $15.95 for the credit report and "FICO" score from each reporting agency. It sounds like the same thing I can get for $5.95 since the credit report is free.

Though I didn't remember the cost off the top of head, you're correct that there is a charge at myfico for a FICO score, and no charge for just a regular credit report at annualcreditreport.

My original post in response to the OP was simply to differenciate between a FICO score and the credit scores given by the 3 bureaus.

The first time I obtained my FICO score was merely out of curiosity.....now (as stated previously) I do it MOSTLY for "sh*ts & giggles" and harrassment purposes at w*rk.

 

[Texas Proud]

I am one of the people who have no idea what my FICO score is....

It will cost me MONEY to find out... so why would I want to pay for a useless score

 

[Helen]

FYI, I just found this. You can use the code CPPSAVINGS to get a 20% discount on the FICO Deluxe for all three reports and FICO scores.

 

[LOL!]

When we refinanced a while ago, the loan folks gave us our FICO scores and the a copy of the report. They give you the top 4 reasons for why your score is not perfect. Since you paid for your report and score, you may have some top reasons somewhere on the report for why it is the way it is.

I think myfico.com also lists some of those reasons, so just go through those reasons for ideas. I'll guess the 30-day late is a big one. Others I have seen are not enough credit used and too much credit used.

 

[Helen]

Thanks all. I will file a dispute with the 3 credit agencies. The one late payment was from when I first started using the online bill pay. My payment was credited to my savings account, it happened four times after that but I caught the error in time.

I'll be curious as to how much of an impact it will have if I can get it removed. I don't really have any proof. I guess I'll research how to dispute an error.

Thanks for all your help.

-helen

 

[brewer12345]

I suspect it won't make much difference, but there is no harm in filing a dispute. Many times someone files a dispute and the creditor never responds to the credit bureau, so they have to drop the black mark. I don't think it will matter anyway, since you more than qualify for top rates. Remember, we are living in a workld where anyone who can fog a mirror and falsify fill out an application gets a humongous mortgage.

 

[jazz4cash]

FICO...........what a scam!
Once upon a time, Fair Isaac said lenders could not reveal credit scores to consumers as it would game the system. Now that they have no choice, they're selling the scores left and right.

Honestly, Helen.............other than correcting any errors, your score should be plenty high enough to get the best mortgage rates. I've tried to fix errors on my file and it can be extremely difficult.......especially when they are trivial anyway. I monitor 3 bureaus quarterly just to monitor who is monitoring me and to protect against ID theft.

 

[Corporateburnout]

FICO...........what a scam!
Once upon a time, Fair Isaac said lenders could not reveal credit scores to consumers as it would game the system. Now that they have no choice, they're selling the scores left and right.

Honestly, Helen.............other than correcting any errors, your score should be plenty high enough to get the best mortgage rates. I've tried to fix errors on my file and it can be extremely difficult.......especially when they are trivial anyway. I monitor 3 bureaus quarterly just to monitor who is monitoring me and to protect against ID theft.

Ditto, I pay to have my credit report monitored. As much as I hate to pay for the service, it insures that I won't fall pray to ID theft again.

 

[Nords]

Thanks all. I will file a dispute with the 3 credit agencies. The one late payment was from when I first started using the online bill pay. My payment was credited to my savings account, it happened four times after that but I caught the error in time.
I'll be curious as to how much of an impact it will have if I can get it removed. I don't really have any proof. I guess I'll research how to dispute an error.

It's not a waste of your time, but raising your score from 825 won't improve the interest rate on your mortgage or give you a deal on any of the other financing requirements. People who are struggling to obtain loans have FICO scores down in the low 600s or even lower. Your score is higher than ours and we're regularly pelted with offers to borrow other people's money at attractive rates.

Your time might be better spent on open houses & on researching credit union financing.

 

[LOL!]

Ditto, I pay to have my credit report monitored. As much as I hate to pay for the service, it insures that I won't fall pray to ID theft again.

How so? Someone can still steal your ID even with credit report monitoring.
With free credit reports available why pay for it? If you are married, you can get 6 free credit reports per year. You get one in Jan, May, Sep. Your spouse gets one in Mar, July, Nov. That's one every two months. It costs nothing.

 

[Corporateburnout]

How so? Someone can still steal your ID even with credit report monitoring.
With free credit reports available why pay for it? If you are married, you can get 6 free credit reports per year. You get one in Jan, May, Sep. Your spouse gets one in Mar, July, Nov. That's one every two months. It costs nothing.

Time is of the essence. The service will notify me by e-mail if anyone is looking into my credit report. In my case three department store credit cards were issued fraudulently before I noticed anything was wrong. They charged a total of $4000......

Your credit can easily be ruined way before you get your free credit report.

 

[BarbaraAnne]

Time is of the essence. The service will notify me by e-mail if anyone is looking into my credit report. In my case three department store credit cards were issued fraudulently before I noticed anything was wrong. They charged a total of $4000......

Your credit can easily be ruined way before you get your free credit report.

I totally agree, Corporateburnout, and we do the same thing. It costs about $80 per year for both of us, after discounts, for the FICO/credit monitoring service, but it is well worth it. Identity theft is rampant and until it happens you have no idea of what a hassle it can be. It happened to a friend of ours and it was a nightmare!

 

[cute fuzzy bunny]

A late 30 day is a big deal, even once, even with a good excuse. By the way, all you can do is put a "consumer statement" into your file to explain the late. Believe it or not, in some cases a consumer statement can cause problems of their own, as this suddenly introduces interpretations by people reading the report. Anyone can see the consumer statement that can get your credit report, so choose your wording wisely. Some creditors view a consumer statement around an unresolved credit problem to mean that the consumer may be "high maintenance" or "troublesome". In any case, it will not change the credit score #.

Score number is a function of length of credit, lack of 'events', percentage of debt to available credit, and the some other interesting tidbits. Therefore, closing old credit cards out may make your score worse. Closing unused credit sources may reduce your available credit and therefor increase the debt to credit ratio, lowering your score. Some folks have determined that an optimum credit score can be achieved by holding exactly three credit cards, two major and one gas. Having department score credit cards appears to lower your credit score. Hard inquiries or excessive soft inquiries may have an effect on your score.

There is also a time factor. Making major changes to your credit may take months or even years to fully take effect and can have a short term negative effect.

Filing a dispute may not be the best course of action. Call the credit entity that is issuing the 30 day late, explain what happened and ask if they can remove that from your credit report. It'll help if you had a good record with them before and have a good record since. Many are hardasses about it and wont change it.

Some tips: http://www.myfico.com/CreditEducation/ImproveYourScore.aspx
http://www.fool.com/ccc/check/check05.htm

 

[maddythebeagle]

another point, OP, you can maximize your credit profile by lowering % credit utilization (that I assume is the point of folks telling you to get a credit increase)...I would avoid any hard credit inquires from a credit increase before a mortgage application....probably wont matter, but might have to go to the bother of explaining....you can lower credit utilization by paying down your balance before statement closing date (when most cards report balances)....and try to keep your utilization to 30-50% and not max out cards....

probably too late to do anything about the late payment this late in the game...I would just wait for it to fall off your reports in a couple of years...

 

[Peaceful_Warrior]

I also have Equifax Credit Monitoring basic service. Enough to notify me anytime there's any inquiries or changes to my report, as well as any significant balance changes (as defined by me) to my credit cards.

I did it after I had a "scare" several years back when my Maxim subscription stopped arriving, and I logged into the online account to see it was going to Maryland instead! I checked everything through and through, and fortunately that was the only change so I didn't worry about my cards/accounts.

My Monitoring also comes with a free credit report 3 times per year where I check my FICO score. I almost never check though because my score keeps going up and up. Last time I checked when looking to purchase a home, the lowest score from an agency was 770 and my highest was 800.

Ditto, I pay to have my credit report monitored. As much as I hate to pay for the service, it insures that I won't fall pray to ID theft again.