Comments on: Debt Reduction: Why Paying Down Your Credit Card Debt Helps Your Credit Score

By: Confused and Conflicted

Confused and Conflicted — Wed, 19 Jun 2013 13:32:23 +0000

I have an installment account that I paid off in late February of this year.
The lender simply stopped reporting the account, without showing that I had a zero balance. Is this hurting me? If I had them report my zero balance would that hurt my score? Not sure what to do

By: EFX Moderator, EM

EFX Moderator, EM — Thu, 11 Apr 2013 15:52:54 +0000

Great question. High balances may negatively impact your credit score, because some lenders may worry that you have taken on too much debt and view the high balances as risky. Although you pay off the balance every month, each lender may update your credit file at different times, so you're not sure which balance is being reported—the one that's paid off or the one that is 70% of your credit limit. Here is more information on how your credit score is calculated. I hope this helps.

By: Anonymous

Anonymous — Sun, 07 Apr 2013 06:09:53 +0000

I feel the same way please take them fools to court.

By: Just Thought I'd Ask says

Just Thought I'd Ask says — Tue, 26 Mar 2013 22:28:10 +0000

How is your credit score affected, say, by charging 50, 60 or 70% of your total credit allowance on several cards each month and then paying the balances off completely each payment period as opposed to keeping running balances over several months? I know it’s better for me, financially, because I get the free use of money for up to a month, but is it detrimental to my credit score by having what appears to be high debt-to-credit ratios each month?

By: Bob Hope

Bob Hope — Tue, 19 Mar 2013 11:35:58 +0000

So what your saying is your fustrated that a morgage company won’t finance you because you want a thirty year loan, but you only have 5 years of good payments? thats right they have a term it’s called high risk. A brief period of instability a few years back, multiple accounts reported late, a judgment and collections, and maxed out credit cards, and i’m steadily pulling out of my credit funk, and i just bought a house. you have 2 more years before that bankrupcy goes bye bye, Just keep steady and you’ll get there. it took me 6 months to get a morgage, i just keep at it, and talk to a few banks i went through a few. right now, 620 seems to be the average fico score they look for. I found out wells fargo looks for 600. I guess thats why they have the largest retail morgage portfoilo.

By: extremely frustrated

extremely frustrated — Fri, 15 Mar 2013 22:44:35 +0000

My credit card company(Orchard Bank) was bought out by Capital One in May 2012, now I find out they are reporting a 30 day late on me for Oct. 2012. I filed disputes with all three agencies and informed them that I had bank statements to support the payment was made on time. I have just found out that they will not remove the late payment because Cap One said they never received the payment. How is it that a credit card company that was clearly in transition can just say we didn’t receive the payment and all the bureaus just take it for the gospel? I was never contacted by anyone to provide the bank statements or any other proof supporting my claim. This is preventing me from obtaining a mortgage loan since I had a previous bankruptcy. I have had a flawless payment history over the last five years and one 30 day late for a $25 payment should tell someone with any common sense that something is not right.

By: EFX Moderator, EM

EFX Moderator, EM — Wed, 06 Mar 2013 19:41:36 +0000

Without knowing more details, I'm not sure what exactly happened, but it sounds like your lender added the refinanced loan as a new account, which impacts your score in a few ways: your old account was closed, you have a new debt-to-credit limit ratio, you probably have a new credit inquiry, you changed your average length of credit accounts. Again, I'm not sure if that's how it's showing up on your credit report, but your credit score is based off of quite a few factors in your credit report. The good news is that you're saving money with the lower interest rate on your car and your positive credit behavior can stay on your credit report forever. Here is more information on how your credit score is calculated. I hope this helps.

By: Stupified

Stupified — Tue, 05 Mar 2013 01:14:52 +0000

How is it that when you refinance a car at a lower interest rate your credit score drops? I paid off about a third of the balance of the first loan which was mirrored in the corresponding debt-to-credit ratio, yet that ratio is back to 1 with the new loan with no credit score consideration, evidently, for the previously paid off loan. What gives?

By: EFX Moderator, EM

EFX Moderator, EM — Mon, 04 Mar 2013 17:44:06 +0000

JD, great question. Accounts not paid as agreed generally remain on your credit file for seven years from the date the account first became past due. We have information on how long information stays on your credit report and how it appears here: http://blog.equifax.com/credit/faq-how-long-does-information-stay-on-my-credit-report/

I hope this helps and thanks for posting.

By: JD

JD — Thu, 28 Feb 2013 15:54:15 +0000

I settled for “less than full” on a few collections will they stay or be removed from my credit report. if they stay on my report how will it read and how will this affect my score.