Personal Finance

My Credit Score is shockingly low

  • Last Updated:
  • Jan 15th, 2018 4:27 pm
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Jr. Member
Nov 8, 2017
116 posts
35 upvotes
fogetmylogin wrote:
Jan 12th, 2018 9:59 am
Being retired and asking for an unsecured line of credit for a vacation or wedding or something yeah having $40k in available credit card limits could be a redflag. 650 or 800 and asking for a reasonable mortgage the score will no no effect. Unlike the US where the scores do matter and rates can be higher for those with good rather than excellent scores.
She isn't retired ...
My point still stands
Jr. Member
Nov 8, 2017
116 posts
35 upvotes
coolintheshade wrote:
Jan 12th, 2018 9:18 am
Did the loan officer not request some lines be closed as a condition of approval for the loan?
If not, then that’s likely not the only reason for the decline.
They told her that's the reason why she was denied, and try again in 6 months
(RBC)
Member
Jan 3, 2017
247 posts
184 upvotes
Tommycoupons wrote:
Jan 11th, 2018 12:04 pm
Your available credit is too high in my opinion and probably why the score is low. I'd eliminate the $20k CC that's where your problem lies... If you have around $13K available total on credit cards and everything else is clean on your record your score will be in low 800's
This is completely bad information. Available credit does not impact credit scores. Can you imagine telling someone like Donald Trump or Bill gates that 13k is to much credit? The place where available credit matters is when it's in relation to your income and your debt service ratios which is what happens when you apply for something like a mortgage
Sr. Member
Jan 15, 2017
775 posts
547 upvotes
User455957 wrote:
Jan 11th, 2018 10:54 pm
My mom got denied a loan cause she had to much available credit with a bunch of unused credit cards she kept in her safe deposit box. Some will see that as a red flag having all the available credit.
That's only one part of the issue. The part that is missing is that your Mom's income is too low should she use all the available credit. This most likely happens when someone experiences a change in income. The red flag is to much credit based on income.
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Dec 12, 2006
4121 posts
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Barrys Bay
Simply put your score if was in 800's 2016.

You applied car financing 3 months ago, your score would had dropped estimated 20-25 points for inquiries, so at 775.

Now your vehicle payment is added to your credit report, so 2 things happen here:
1st off the vehicle loan will only be 3 months old and usually car loans are about 1 month behind in reporting so only 2 months reported, so you loan will be listed as too new to rate ( so scoring method defaults to look high utilization warning method)
2ndly your utilization will be 95-100% on loan your score will take a good dive cause of 1st point at say 50-100 points ( so brings you down to 675-650 ) secured loan warning ( so this stops people from good score today and abusing credit by applying 2 vehicles, cards, etc... )
.

So after about 4-6 months, car loans hit the marker of not being new and you have made 4-6 payments on time and changes the scoring method says hey you are paying and its a secured loan and in good standing, the credit application points come back slowly and the dramatic drop ups 50-75 points

You have nothing to worry you score will be better in nest 2 months with your normal habits.
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Sep 19, 2013
1079 posts
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Winnipeg
fryguy1987 wrote:
Jan 12th, 2018 11:23 am
This is completely bad information. Available credit does not impact credit scores. Can you imagine telling someone like Donald Trump or Bill gates that 13k is to much credit? The place where available credit matters is when it's in relation to your income and your debt service ratios which is what happens when you apply for something like a mortgage
Even I am positive that available credit is not an issue for the score. I am not 100% sure though, just something I recollect reading at multiple places.
In the beginning the Universe was created. This has made a lot of people very angry and been widely regarded as a bad move. -- Douglas Adams
Member
Mar 16, 2011
259 posts
119 upvotes
theguyz wrote:
Jan 12th, 2018 12:19 pm
Simply put your score if was in 800's 2016.

You applied car financing 3 months ago, your score would had dropped estimated 20-25 points for inquiries, so at 775.

Now your vehicle payment is added to your credit report, so 2 things happen here:
1st off the vehicle loan will only be 3 months old and usually car loans are about 1 month behind in reporting so only 2 months reported, so you loan will be listed as too new to rate ( so scoring method defaults to look high utilization warning method)
2ndly your utilization will be 95-100% on loan your score will take a good dive cause of 1st point at say 50-100 points ( so brings you down to 675-650 ) secured loan warning ( so this stops people from good score today and abusing credit by applying 2 vehicles, cards, etc... )
.

So after about 4-6 months, car loans hit the marker of not being new and you have made 4-6 payments on time and changes the scoring method says hey you are paying and its a secured loan and in good standing, the credit application points come back slowly and the dramatic drop ups 50-75 points

You have nothing to worry you score will be better in nest 2 months with your normal habits.

This is a good way of describing it. I also converted a portion of my LOC to the TD Fixed Rate Option (which turns it into a low interest loan). The credit score took a hit but within 4 or 5 months, it has regenerated itself.
Member
Oct 10, 2016
223 posts
66 upvotes
playerunknown wrote:
Jan 11th, 2018 10:19 am
I signed up for Transunion Credit Monitoring after Nissan got hacked and offered it for free.

My score is shockingly at 670 - poor.
  • My only Debt is my mortgage and car.
  • Paid off my student loans
  • I use my credit card for everything for the points - about 3-4K per month, but it gets paid off every month in full.
  • All my bills are pre-authorized, so no missed payments.
I have three credits cards and I only use the one.
I understand there is a credit utilization ratio for my credit card - but does that really knock down my credit this low? (the credit card limit is 10K for the one I use 99% of the time, my other older ones are 20K and 1K and they just sit in the drawer)
From what I remember, when I was getting my mortgage back in 2016 - I was in the 800's, I recently got a new Infiniti without any credit issues less than 3 months ago.

Do I need to take action?
670 aint bad dont worry
Member
Dec 12, 2008
235 posts
7 upvotes
Ottawa
Hi,

I need some advise on what to do to maintain my credit score.

I recently (about 1 month ago) applied for credit card from The Bay and it was surprisingly denied. From 2007, I had an HBC credit card with good standings at all time, and it was closed in 2015 due to inactivity when HBC switch with Capital One.

I requested a credit report from both credit unions and with Transunion I rate at some 790. I'm still waiting for the other bureau to arrive.

Also, I have a Capital One mc since 2009 with no outstanding balance. As I am not using this MC, it may be closed also due to inactivity in the months to come. I have two RBC cc that I use often. I pay them on time every time and always full balance. So, I do not understand why the HBC Capital One cc was denied.

Would you recommend me keeping the Capital One mc or letting them close it due to inactivity again? I had a few accounts closed (6 according to Tranunion report, some I closed and some were closed for inactivity) in the past and they should all disappear in the months to come from my report, but I am looking at acquiring some real estate and can not afford any credits denial.
"Peace is not a word, it is an attitude" -FHB.
Sr. Member
User avatar
Mar 9, 2012
617 posts
214 upvotes
Why do you care about your score? Are you planning to apply for any new credit anytime soon?
Deal Addict
Jul 18, 2016
1879 posts
688 upvotes
theguyz wrote:
Jan 12th, 2018 12:19 pm
Simply put your score if was in 800's 2016.

You applied car financing 3 months ago, your score would had dropped estimated 20-25 points for inquiries, so at 775.

Now your vehicle payment is added to your credit report, so 2 things happen here:
1st off the vehicle loan will only be 3 months old and usually car loans are about 1 month behind in reporting so only 2 months reported, so you loan will be listed as too new to rate ( so scoring method defaults to look high utilization warning method)
2ndly your utilization will be 95-100% on loan your score will take a good dive cause of 1st point at say 50-100 points ( so brings you down to 675-650 ) secured loan warning ( so this stops people from good score today and abusing credit by applying 2 vehicles, cards, etc... )
.

So after about 4-6 months, car loans hit the marker of not being new and you have made 4-6 payments on time and changes the scoring method says hey you are paying and its a secured loan and in good standing, the credit application points come back slowly and the dramatic drop ups 50-75 points

You have nothing to worry you score will be better in nest 2 months with your normal habits.
I think this varies from profile to profile. In my case, my car loan in August of 2015 had zero impact on my credit report. My score may have moved by 5 or 6 points during that period. Since then my score hasn't budged in any significant way. It remains in the same 25 point range.
Member
Aug 31, 2001
224 posts
3 upvotes
Toronto
Tommycoupons wrote:
Jan 11th, 2018 12:04 pm
Your available credit is too high in my opinion and probably why the score is low. I'd eliminate the $20k CC that's where your problem lies... If you have around $13K available total on credit cards and everything else is clean on your record your score will be in low 800's
Hey everyone,

Just want to get some opinion if anybody spot anything with my credit profile

Current Equifax Score: 755 as of Dec 2017. This was dropping since April 2017 at a 790 score
Current TransUnion Score :738 as of Jan 15th 2018. This dropped 40 points since Dec 2017. From 778

1. I have been shopping around for Unsecured LOC. So made an inquiry with Simplii, BMO, and now National Bank as of today the last month.
2. I apply for credit cards maybe 2-4 times a year - credit card churning.
3. In terms of Credit Cards Open:
I have about 6 CC's with 2 of them with a lot of credit history and 1 Amazon.ca kept for the 0% currency conversion when I travel.
The other 3 is just under churning and can be cancelled soon

In total, I have 62.5k of CC Credit Line open with near 0% Utilization as I pay my bills to $0 every month

I am thinking of cancelling some of the credits cards or request that the credit limit lowered in order to maximize the ability to get a high limit on my unsecured LOC, and also possibly to improve credit scores?

Does the fact that I have so much CC credit available, affect my overall score or ability to improve score and also ability to get more limit?
I was thinking having a low overall credit utilization is good, so it would be ideal to have good amount of credit available.

Any recommendations?
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User avatar
Sep 19, 2013
1079 posts
297 upvotes
Winnipeg
Sedul wrote:
Jan 15th, 2018 2:42 pm
Hey everyone,

Just want to get some opinion if anybody spot anything with my credit profile

Current Equifax Score: 755 as of Dec 2017. This was dropping since April 2017 at a 790 score
Current TransUnion Score :738 as of Jan 15th 2018. This dropped 40 points since Dec 2017. From 778

1. I have been shopping around for Unsecured LOC. So made an inquiry with Simplii, BMO, and now National Bank as of today the last month.
2. I apply for credit cards maybe 2-4 times a year - credit card churning.
3. In terms of Credit Cards Open:
I have about 6 CC's with 2 of them with a lot of credit history and 1 Amazon.ca kept for the 0% currency conversion when I travel.
The other 3 is just under churning and can be cancelled soon

In total, I have 62.5k of CC Credit Line open with near 0% Utilization as I pay my bills to $0 every month

I am thinking of cancelling some of the credits cards or request that the credit limit lowered in order to maximize the ability to get a high limit on my unsecured LOC, and also possibly to improve credit scores?

Does the fact that I have so much CC credit available, affect my overall score or ability to improve score and also ability to get more limit?
I was thinking having a low overall credit utilization is good, so it would be ideal to have good amount of credit available.

Any recommendations?
total credit available does not affect credit score. credit utilization does. but even there its a sliding scale in the actual algorithm. its not like a threshold value suddenly lowers your score. if you are going to be around or below 30%ish anyways, then you can close some of the cards, especially newer ones. that improves the score as your average credit is now aged. also, your definition of credit utilization seems to be incorrect. do you pay your bills before the billing date or after? if before, then yes you have 0 utilization. 0 utilization is also not ideal as sometimes, some companies just dont report your payments, which is bad for your score. if you are paying after the billing date (but before the due date of course), then your utilization is not 0. its the total credit card bill divided by total credit.
In the beginning the Universe was created. This has made a lot of people very angry and been widely regarded as a bad move. -- Douglas Adams
Member
Aug 31, 2001
224 posts
3 upvotes
Toronto
amitdi wrote:
Jan 15th, 2018 2:52 pm
total credit available does not affect credit score. credit utilization does. but even there its a sliding scale in the actual algorithm. its not like a threshold value suddenly lowers your score. if you are going to be around or below 30%ish anyways, then you can close some of the cards, especially newer ones. that improves the score as your average credit is now aged. also, your definition of credit utilization seems to be incorrect. do you pay your bills before the billing date or after? if before, then yes you have 0 utilization. 0 utilization is also not ideal as sometimes, some companies just dont report your payments, which is bad for your score. if you are paying after the billing date (but before the due date of course), then your utilization is not 0. its the total credit card bill divided by total credit.
Thanks,

Correct. it is not 0% Utilization, I just pay after billing date but before due date monthly.

The amount of credit that I have currently available to me via (CC), will also affect how much credit (of other forms) I can apply for for PLOC or Loans, correct?
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Sep 19, 2013
1079 posts
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Winnipeg
Sedul wrote:
Jan 15th, 2018 3:09 pm
Thanks,

Correct. it is not 0% Utilization, I just pay after billing date but before due date monthly.

The amount of credit that I have currently available to me via (CC), will also affect how much credit (of other forms) I can apply for for PLOC or Loans, correct?
I remember reading at multiple places that it does not affect. But that one I am really not 100% sure of. Maybe other experts can chip in.

For your situation, if the credit you are going to cancel is a newer one, then its looks like a simple decision. Go ahead and cancel it. If its an older one, then you really need to decide how to approach this.
In the beginning the Universe was created. This has made a lot of people very angry and been widely regarded as a bad move. -- Douglas Adams

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