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I checked my credit score today and it took a massive dip compared to one month ago:

enter image description here

Ignore the gray line - it's immaterial.

  • Transunion - Green
  • Experian - Blue
  • Equifax - Red

I downloaded the credit report and compared it line by line with the report from last month. They are exactly identical, except for one thing: my revolving debt went from $16 to $0.

Can someone explain why the score would dip like this and whether there is anything I could do.

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  • can you tell me from where you are pulling the scores ? and how much you are paying for monthly monitoring of credit score ? Thanks.
    – N30
    Commented Feb 22, 2012 at 17:21
  • @N30 I am getting the scores from privacyguard.com. The service is $14.99 and provides the scores as well as the entire report, plus a couple of other handy services.
    – NeedAdvice
    Commented Feb 25, 2012 at 5:35
  • Important question: did you simply pay off all of your cards, or did you close them as well? I ask because your followup question indicates that you "no longer had any credit cards".
    – Bigbio2002
    Commented Nov 28, 2012 at 23:38

2 Answers 2

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I wrote an article about FICO scoring which shows that 30% of your score is based on utilization or amount owed. I can't say exactly how much your score will rise, or how long it will take, but your score will improve dramatically from what you propose.

Utilization Chart

This chart is from Credit Karma, and it shows how zero utilization is actually bad when it comes to your score. I wrote an article on my blog titled Too Little Debt in which I discuss further.
Under 20% is ideal, just not zero.

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  • The odd thing is that I actually have 2 credit cards (one is a hybrid check card) from Wells Fargo that do have revolving debt, but it doesn't show up on the report. I called Wells Fargo and they said that in the case of one card, they only report it when I am delinquent. And for the other card, they never report it because it just draws on my checking account.
    – NeedAdvice
    Commented Jan 11, 2012 at 21:42
  • But you did say the $16 showed on the report, right? Keep in mind, you don't need to pay interest. It's just the month end balance that's causing you grief.
    – JTP - Apologise to Monica ♦
    Commented Jan 12, 2012 at 1:24
  • Credit cards are reported, delinquent or not. Either the OP has a checkcard or the WF rep was clueless
    – f1StudentInUS
    Commented Jan 12, 2012 at 2:49
  • Are mortgages? Because I am refinancing and my bank told me my mortgage on a rental wasn't showing on my credit report. They got me, the other bank, and Experian on a conference call to request the bank transmit my history to the credit bureau. Strange, but true.
    – JTP - Apologise to Monica ♦
    Commented Jan 12, 2012 at 2:52
  • @JoeTaxpayer: I was speaking from personal experience, which I do not have regarding mortgages. However, I remember that mortgages have a special place/category in Experian (or was it Equifax's?) scoring. Essentially people with mortgages score higher than ones that do not, everything else being equal.
    – f1StudentInUS
    Commented Jan 24, 2012 at 19:20
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Your case is an excellent example how no credit is scored similar to bad credit.

This curve is nothing unexpected (documented on many sites, including creditkarma) and can be un-done the next reporting period if you maintain at least 1% utilization.

myFICO folks recommend 9% for some reason I have never understood.

Don't worry: if the only reason your credit took a dip is because of your 0% utilization (as you say), it's only a matter of paying for your coffee using that dusty card.

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  • I don't know about the real models but some of the fake models have a gotcha: They take the utilization percentage as an integer--I've taken a substantial ding when my utilization dropped below half a percent but was not zero. (It's actually only current charges showing up, I don't carry balances.)
    – Loren Pechtel
    Commented Mar 24, 2015 at 23:18

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