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Message
Is there a bigger scam than your Credit Report Score?
Posted on 7/9/25 at 10:40 am
Posted on 7/9/25 at 10:40 am
Just feels weird that my credit score continues to decrease as I don’t owe money. I’m middle aged, own my home outright, cars outright, and never carry a balance on my credit cards past the current month. My credit score has dropped weekly as I owe less and put more away in savings. It’s like they want to encourage debt on people so that it’s easier to get more credit to go further in debt with a bad choice.
Or am I over thinking this whole thing?
Or am I over thinking this whole thing?
18
Posted on 7/9/25 at 10:42 am to Lsudx256
It's a debt interaction score, the less you have (pay off mortgage, pay off car loan, etc) the lower your score will be. Can counteract this by getting credit limit increases on your credit cards, or open new credit card so your utilization score at least can go up.
No you dont have to go out and get a bunch of loans to increase your score, but paying off loans will have a negative impact with closed accounts basically if you're not paying anything monthly.
No you dont have to go out and get a bunch of loans to increase your score, but paying off loans will have a negative impact with closed accounts basically if you're not paying anything monthly.
This post was edited on 7/9/25 at 10:44 am
Posted on 7/9/25 at 10:44 am to Lsudx256
quote:
my credit score continues to decrease as I don’t owe money
No lie, they want you to have open credit but only utilize 25% of it or so.
Posted on 7/9/25 at 10:46 am to Lsudx256
Did you close revolving accounts as you paid them off? That can negatively impact your credit score, especially if it was an older account.
Keep credit card accounts open. At least use them once in a while and just pay off the balance in full when the statement closes. You won't incur any interest if you pay the entire statement balance before the due date.
Keep credit card accounts open. At least use them once in a while and just pay off the balance in full when the statement closes. You won't incur any interest if you pay the entire statement balance before the due date.
Posted on 7/9/25 at 10:50 am to thunderbird1100
Spot on. I tell people credit scores are more of a score about if someone can make money loaning you money. If I give you a loan and you pay it back quickly I don't make any money.
Opening a new card and requesting credit limit increases periodically does help.
Opening a new card and requesting credit limit increases periodically does help.
Posted on 7/9/25 at 10:51 am to Tiger Prawn
But, this makes no sense
Posted on 7/9/25 at 11:03 am to ynlvr
quote:
But, this makes no sense
Credit score looks at the age of your oldest account and the overall average age of all accounts. It benefits your score to have more old accounts as compared to having mostly newly opened lines of credit.
Also affects credit utilization. Say you have $10K in debt but $50K in credit limit combined among a few accounts. Your utilization is 20%, which is fine. But say you paid off a few of those balances and then closed the account, with the closed accounts having had $25K in credit limit. Now you still have the $10K in debt but on only $25K left in total credit limit on open accounts. Now your utilization is 40% instead of 20%. Lower utilization = better score.
ETA: getting a credit limit increase on an existing account can boost your score because now if you have the same $10K balance, but a higher total credit limit...your utilization percentage will be lower.
This post was edited on 7/9/25 at 11:07 am
Posted on 7/9/25 at 11:06 am to Tiger Prawn
I get what you are saying, but how does that make sense? This score can affect my rate as well as the opportunity to get a loan, if needed. Wouldn’t a bank or lending institute rather do business with someone they know can be trusted to actually pay it back? Or would they rather deal with people who can’t, or who will pay extra because of missed payments and such? Again, leads me to believe it’s a scam.
Posted on 7/9/25 at 11:07 am to Lsudx256
You're right.
It should be a decaying memory, which is very easy to program. You should continue getting a boost from recently satisfied loans.
It should be a decaying memory, which is very easy to program. You should continue getting a boost from recently satisfied loans.
Posted on 7/9/25 at 11:12 am to Lsudx256
quote:
Wouldn’t a bank or lending institute rather do business with someone they know can be trusted to actually pay it back?
Thats why your oldest line of credit and your average account age matter. The bank can see your long history of on-time payments with those accounts. If you close all your older accounts, they can't see that payment history anymore on those accounts.
If your credit report is full of newly opened accounts, it makes lenders wonder why you're opening so many accounts in a short time span and whether you may over-extend yourself.
Posted on 7/9/25 at 11:16 am to Lsudx256
quote:
Wouldn’t a bank or lending institute rather do business with someone they know can be trusted to actually pay it back?
You just answered your own question. How do they know you'll pay it back if you don't borrow in the first place. That's kind of the point.
Overall though, you're probably worried about nothing in the grand scheme of things.
Posted on 7/9/25 at 11:41 am to Lsudx256
Yes and no. Lenders want to deal with people whom they can profit. The most profit comes from people who do a lot of borrowing and pay on time. People who don't pay it back are obviously the worst. People who pay back early aren't ideal because the lender doesn't profit as much as expected. People with late fees ect. make profit but come with more risk.
It's not perfect but it's a score of how likely a borrower is going to be profitable for lenders.
Sometimes a bank will ask a business to move deposit accounts to that bank before making the loan. So they can profit from holding more deposits.
It's not perfect but it's a score of how likely a borrower is going to be profitable for lenders.
Sometimes a bank will ask a business to move deposit accounts to that bank before making the loan. So they can profit from holding more deposits.
Posted on 7/9/25 at 11:43 am to Lsudx256
quote:
Is there a bigger scam than your Credit Report Score?
Not really. The credit industry has done a masterful job of creating an environment where it guarantees its own survival by demanding that life be more difficult for those who don't use their services. The over-consumerism of American society is leading a growing number of consumers into being what are essentially lifelong indentured servants.
Posted on 7/9/25 at 12:59 pm to Lsudx256
use business credit cards and lines of credit that do not report to your personal report. apply at local banks for busines cc's. also ONLY use business cc's that DO NOT report to your personal credit. here are a a few to use and avoid.
LINK
ETA: this is all assuming you have a business or side hustle. if not get one. use business credit. it is great to combine with your personal.
LINK
ETA: this is all assuming you have a business or side hustle. if not get one. use business credit. it is great to combine with your personal.
This post was edited on 7/9/25 at 1:25 pm
Posted on 7/9/25 at 1:11 pm to Lsudx256
In a vacuum, would you rather lend money to someone who has carried small amounts of debt for twenty years and have never, not once, missed a payment; or, would you rather lend money to someone who hasn't carried debt for twenty years and all of a sudden needs a loan?
All else equal, which of those two scenarios seem safer for the creditor?
All else equal, which of those two scenarios seem safer for the creditor?
Posted on 7/9/25 at 2:54 pm to Lsudx256
quote:I think the Nigerian prince scam is bigger...
Is there a bigger scam than your Credit Report Score?
Posted on 7/10/25 at 4:45 pm to Lsudx256
People think of credit score like a report card for what you’ve done - it isn’t. It’s a score used to predict the likelihood that you repay a certain debt. Scores will vary at the same time based on whether you apply for a mortgage or a credit card.
As you “get out of debt”, there is less evidence that you can manage debt. Being debt free for years is terrible for your credit score.
As you “get out of debt”, there is less evidence that you can manage debt. Being debt free for years is terrible for your credit score.
Posted on 7/10/25 at 9:46 pm to Lsudx256
quote:
Is there a bigger scam than your Credit Report Score?
Social Security
Posted on 7/11/25 at 1:10 pm to Lsudx256
quote:
Is there a bigger scam than your Credit Report Score?
If you stop thinking about it as if credit scoring is a government scheme and accept it is simply a business scheme, it'll make more sense.
Your credit score, if you are poor, indicates your ability/likelihood of paying your loans.
If you are not poor, it indicates whether or not loaning you money will be profitable for the lender.
A lender doesn't case that your house and cars are paid off and you have loads of moneys, a lender wants to make money in interest.
No car dealer will turn down your wad of cash when buying a car, because they make money on the sale.
Posted on 7/12/25 at 7:33 am to Lsudx256
If you don't owe anything and don't need to borrow money, who gives a shite what your credit score is?
If you do decide to borrow for a car loan or mortgage, you'll get the best rates if your score is like 750 or better, so there's no need in being upset because it dropped from 802 to 795 one month.
probably
If you do decide to borrow for a car loan or mortgage, you'll get the best rates if your score is like 750 or better, so there's no need in being upset because it dropped from 802 to 795 one month.
quote:
am I over thinking this whole thing?
probably
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