What am I doing wrong?

[Ekop785]

CH7 discharge was last summer and FICO is still in the toilet. I thought I was doing everything I was supposed to do.

I have one secured CC, and three small limit unsecured cards (I know FICO hates "thin files").

I have one installment account for a small personal loan (FICO loves to see both types, right?).

No late payments.

I had a high utilization rate on some of the cards, so I recently paid them off - got email from Experian that FICO has again DECREASED.

What else should I be doing?

[shipo]

It looks like you've run into the proverbial AZ (All-Zero) penalty; if all of your revolving credit cards are showing a zero balance your FICO scores, primarily your FICO-8 scores, will drop. The good news is the score drop is transient in that if you have one card report a small balance next month your scores will most likely bounce back higher than they were before you paid all of the off. The technique I just alluded to is called AZEO (All-Zero Except One); basically you pay all cards to zero immediately prior to their statement date, except one which you pay down to say, $25.00 and let that balance report. Long story short, if you have three cards reporting $0.00 and one card reporting $25.00, your scores will bounce back.

[justbroke]

I love shipo 's excellent AZEO explanation.

Here's some other things to watch out for. Store cards, that don't have a MasterCard, VISA, AMEX, or Discover logo on them, are really bad. It's best not to even use them at all (I learned this by playing with my FICO score!). With AZEO you should be paying all cards to zero, yes, but let one MasterCard, VISA, AMEX, or Discover report.

Be careful of AMEX since they have both charge cards and revolvers. We are talking about the revolvers here. AMEX charge cards report differently (because they don't have a credit limit) and I don't know the impact of the AMEX charge cards (other than on total utilization).

The other thing is to make sure that the card that you let report a balance reports less than 8.9% of the credit limit. If you have a $300 card, it must report less than $27.00 for that period (including your interest). This will get you the maximum score possible under the AZEO method.

In all cases, never let a card report over 29%. That's where the scores really get hit. As you approach 89%, the score takes a further drop. Having a balance which is 89% of your limit is considered "maxed" out.

I hope you mean that your scores are all above 620 (FICO 8/FICO 9), but you're having trouble increasing the score. As you approach the one year mark, you should definitely be able to see scores in the 670 range unless these are all new accounts and/or you have lots of inquiries or some stuff still report as bad.

[Ekop785]

Thank you for the tips! I will be sure to let at least one card report monthly. Yes, these are all MC, Visa and AMEX - no store cards.

I will also try very hard to not exceed 8.9% utilization.

Yes, I am above 620, but barely. Experian shows me at 637 and I know they are more "conservative" than the others, so is probably higher on TU and EQU. I think at the time I filed I was at 504, so I have made some progress.

[shipo]

Looking at my Experian FICO 8 Score Tracker which starts 4 months and 8 hard inquiries after my Chapter 13 discharge:

Date	FICO 8	Notes:
2020-07-04	623	Closed my first secured credit card
2020-08-13	607	Second secured credit card starts reporting
2020-10-11	611	A few months of payments
2020-11-07	623	A few more months of payments
2020-11-21	643	No idea why it bumped up 20 points here
2021-02-13	642	Three months of no movement in spite of 4-more HPs and 1 new CC
2021-03-13	653	New CC, my second, starts reporting
2021-06-05	667	Third CC starts reporting as does my SSL
2021-07-17	678	First card ages to over 1 year
2021-08-14	659	My first "All-Zero" penalty
2021-11-05	688	About as good as it gets with the Chapter 13 still on my record
2021-11-22	684	Another "All-Zero" penalty
2022-03-11	840	Chapter 13 dropped off my reports

Long story short, time is your friend; you have enough credit to get your scores up, keep your utilization low, keep all revolving cards paid off except one, and then let everything age.