I have a question about the recent change to how credit scores are calculated, the “NEW” formula or method they are using now.
Has the “NEW” method put more weight or focus on the amount of credit you are using compared to the previous system?
I ask because when my credit usage is zero my score is one number, then, I can use as little as 1% of my available credit and my score will take a FIFTY (50) POINT DROP just from using 1% of available credit. In the last year or so, I have kept my credit usage below 3% and usually closer to 1% but unless my credit usage is ZERO, it drops my score an insane amount.
It use to not be that severe or much or maybe I am not remembering correctly. From what I remember, as long as you were under 10% it did not impact your score much, usually you had to be at 28% or more to drop your score 50 points, but now mine drops 50 points or more if my usage is as little as 1% but the score drop from 1% to 28% is not as drastic like it use to be.
Hope I explained that so you can understand, it just seems my score takes a huge hit unless I keep my credit use at zero, so its like having two scores, my zero balance score and my functional score which is essentially if I use credit at all. Needless to say its frustrating because if I want to make a large purchase, I have to pay off all my cards to get that 50 point boost to get a better rate.
That’s crazy! I just checked mine and I am not seeing changes like that. Can you try another platform to view your credit score and see if it varies that much?
This is nuts, just because my amount of chedit used went from 1% to 7% my score dropped 38 POINTS, and I am still 3% below the 10% recommendation. So essentially at this rate, if you have $100,000 in available credit, you can only spend 3% or less to avoid a huge score drop, so out of $100,000 available, you can really only use up to $3,000…
That is insane, one not so big purchase and your score is killed like mine was when I put my most recent airline ticket and hotel expenses on credit. If your score drops 40 points for using less than 10% of your available credit, then its really insane to worry about your score. They need to change this and make it have less impact unless you go over 30 to 50 percent, anything below that should not change the score more than a couple of points.
Personally, and to be more realistic in this ever fast changing world, the BEST way to contain, control ones credit is first look into AMEX, as they are NOT like any other card, they have MANY variables in saving dollars while one spends, and as long as one is paying over 50% off each monthly,{which extends to 60 days at no extra charges}, then your credit is looked at Good…. I have tested this for larger purchases too, and as I place ALL debits through AMEX I receive always extra dollars, and it’s very good. *Additionally they are much easier to understand with ones credit score, and the BEST is over any credit card, to which I would like to say that AMEX is not like ANY, they have their own systems, and which watching your back they are excellent •••• unlike Visa, to which we are forced to have as a back up due to some businesses still backwards with understanding how it actually benefits them so they don’t deal with them~ smart people tend to then shop ect… elsewhere that does use AMEX•••thus Visa rarely gets used, which is most sensible for the truth always comes out yearly when assessing for tax purposes ect…
*Additionally most of these” credit score apps are NOT required as Most banking institutions make their own rulings; also I was dealt with a blatant NO about adding in this extra detail; so overall as it is not actually legal based, one might need to ask themselves the question to why one is Giving just more details , that are taken from ‘so called’ assisting sites, as IN credit scores.?!
