     Zachary1 (Drcredit) | Tuesday, March 20, 2001 - 02:30 pm 
Christine: Would severe one-day variances (e.g. end of month to beginning of month) in scores be due to the fact that the scores instantly change the moment new statement information is received at the bureaus? For instance, could an increased statement balance (it's the statement closing balances that show up on the reports; not necessarily current balances) cause an overnight drop of 24 points based on the fact that ratios are now different?
Observation: In my mind, if one was careful and knew exactly when statements closed, one could have revolving balances YET have zero balances show up on the reports by paying say 2 or 3 business days before the statement balance date and then charge up the account right after the statement date passes....while using extra cash freed up from that manoeuvre to attack the next bankcard balance, etc. etc. Could this work? If one was planning a large purchase and did this carefully for the 60- to 90 days leading up to the application date, they could "game" the score pretty well, it would seem to me. |
| Christine Baker (Admin) | Tuesday, March 20, 2001 - 05:56 pm
Everybody, PLEASE do NOT post YOUR question into someone elses topic.
If I have to spend hours every day reviewing postings, deciding on appropriate subjects, creating subtopics, and then moving them, well, I'll just have to go to queued posting when I go out of town again next week, and all summer.
Zachary asked a good question, but I'm too busy to think about this right now. Anyone else? |
| MV (Mel) | Wednesday, March 21, 2001 - 05:48 pm
I'm pretty sure they use the balance on your statement closing date and that's what they report. So I guess it's best to make sure your payment gets there a few days before your statement closes if you want it reported to the CRA's as a $0 balance. |
| Zeddicus Zuul Zorander (Zeddicuszuul) | Wednesday, March 21, 2001 - 06:08 pm
I've been told by two bureaus that monthly updates are the default. I'm also told that some institutions will report weekly, and the very large card companies will report daily (perhaps even real-time now, or in the not-too-distant future).
That information is from the bureaus' point of view. I don't know whether they meant that *everybody* gets updated daily, or if the bureau was referring to how frequently they get tapes from the lenders (i.e., each account shows up only in one day's transmission each month, but not the other 27-30 days' tapes). |
| Patricia Holly (Househunting) | Wednesday, March 21, 2001 - 07:28 pm
It seems incredibly hard to believe that the creditors and bureaus would start updating my balance every day. The bandwidth for such an update is enormous for very little benefit. IMO as a DBA. |
| Zachary1 (Drcredit) | Thursday, March 22, 2001 - 12:35 pm
I would tend to agree with Patricia's point. The bureaus are in business to make money, cut IT costs and eliminate clerical work.
There would be a way to find out: Run a report for four consecutive weeks or so and find out if the reported balance had changed on a card you use often (like my gas card, for example). I think the monthly statement balances MUST be the 99% reality.
Like I said above, if you got a chunk of cash sitting around equal to your highest credit card balance, you could make ALL your ratios disappear altogether by revolving your multiple accounts with balances around each card as it approaches its statement date. This, of course, could be effective with revolving accounts but not instalment loans or mortgages. But it seems that FICO scores big time on bankcard info and the associated debt-to-limit/high-credit ratios on them.
Because of MY individual situation, I carry upwards of $15,000 on varying-rate credit cards and a line of credit for my business...but I do this because I'm in business and can deduct the interest charges against my income; and my income is more than sufficient for servicing this type of debt...but this should obviously NOT be the modus operandi for the ordinary working person, as they could be drowned in this amount of revolving debt.
My strategy:
When it comes time to apply for a new loan, even though my payment record is perfect, I would want the ratios to look good at the time my report is pulled so that I can score better; however, my score is of no concern after the approval when I'm carrying the higher debt levels and I'm not applying for new credit. My ONLY concern in those interim times is to make sure the payments are made on/or ahead of time and that the accounts age and are reported accurately. That way, I know I got my 35% payment history factor of FICO licked, while improving on my account ages (10 or 15%, I forget). When it comes time to apply, I would want to do what I can in the 30% category of balance-to-limit ratios. In this way, I would score high by paying attention to the aspects that would receive the most weight in the FICO score. It reminds me of school exams: I would concentrate on what I could easily answer quickly and what would count for the most marks first, and if time permitted, work down from there.
If somebody is seriously going to make sure their credit is pristine before making a major purchase, they should try this and report back on this board to see how the bureau report(s) looked! I know I will when the time comes; however I don't need credit in the foreseeable future. |
| Shylock (Shylock) | Thursday, March 22, 2001 - 06:51 pm
I used to have a subscription to creditinfocenter.com and I was able to see my credit report as often as I wanted. The other advantage was that I got to see the entire report, not some EZ-READ format.
I found that all my creditors reported on the last day of the month. So they'd report on 1/31, 2/28, 3/31, etc.
Based on that I'd figure that if someone wanted to 'time' their payments to keep their debt appearance as low as possible they'd want to make massive payments to arrive on or about the 25th and start charging again on the first.
It could take almost a whole month for that tape information to get loaded into the system. Accordingly I recommend people apply for credit as close to the end of the month as possible (unless you expect that new update will drop your score). |
| Shylock (Shylock) | Friday, March 23, 2001 - 06:49 pm
I misspoke myself. That was actually consumerinfo.com that I had a subscription to. |
