The Credit Score Game: Utilization
FICO Credit Score is a number assigned to credit worthiness and is based on many factors including usage and risk and time.
For the last 90 days I have played the credit score game. Utilization of my credit card is how I played. For the last 90 days I charged the cell phone bill and a utility company's monthly bill to the credit card.
 March 2015 |  June 2015 |
Allowing the charges to hit the statement was the next step. Once the charges are on the statement they get reported to FICO as Credit Card Usage.
Zoom in if needed. The line on the image moved to the right indicating I increased my FICO Credit Score between March and June 2015.
Value of a Higher FICO Credit Score
FICO Credit Scores are not cool. Since I am buying a house I decided that a higher score would ensure the lowest rate on a mortgage.
 |  |
"Highly qualified" borrowers like Mrs. MBG and myself receive interest rates that are lower then people who have medium to low credit scores. Those with bad credit scores may not meet lending requirements for a mortgage.
Other Factors in FICO Credit Scoring
Time is a factor that will increase steadily. You cannot change time but you can use the time to pay your debtors on-time. The Age of Credit appears to be an average to the dates for which the credit was opened.
| Total Accounts is the number of accounts that have been used during your lifetime, open and closed. As you can see FICO Credit Score is higher for people who open more accounts. | |
While I could have raised my score by opening as many as seven more accounts. There would have been a lowering of the score in the Age of Accounts category.
Credit Inquiries are the last category that impacts the FICO Credit Score. My credit score has four inquiries in the last seven months. Full Pre-Approval for a mortgage is the reason. It's pretty difficult to be qualified for a mortgage without a hard Credit Inquiry. A cash purchase would be cool.
 March 2015 |    June 2015 |
Derogatory Remarks Hit FICO Hard
Derogatory Remarks have an adverse effect on your Credit Score and hit a FICO credit score really hard! I didn't discuss any change in this category because it made no changes in three months. It takes years to repair your derogatory remarks.
Payments on your debt is necessary to maintain excellent credit. As few as one Derogatory Remark (a.k.a. missed payment) will begin to lower your credit score. If you are late on multiple accounts then your credit score will suffer.
Credit Card Deadbeat or Freeloader
For many months I was a credit card deadbeat. I would pay my payment before the credit card statement would close. When the statement closed I would receive a statement stating zero balance was due.
Now I am a credit card freeloader. I not so patiently wait for the credit card statement on the 24th of each month. When it arrives I electronically make the payment, usually the same day. The credit card company reports the balance and payment to FICO. In return they get nothing. I'm a freeloader.
< Read Previous
Read Next >
Comments: In no way did I cover this subject in detail. Did I get close to sharing something you think is important but didn't? Now is your time to shine. Go ahead and tell me any tips you have that may be helping your credit.
