Mortgage payment each month not increasing my credit score?

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pb576
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Mortgage payment each month not increasing my credit score?

Postby pb576 » Fri Aug 29, 2014 7:33 am

I have a mortgage that I have had for approx 10 years. Although it does show up on my credit report as paying on time, etc, it has not been increasing my credit score. I have been monitoring this closely for the past 2 years, and it shows no signs of such. Is this normal?


MemberSince99
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Postby MemberSince99 » Fri Aug 29, 2014 8:09 am

With the information you gave, it's hard to even make a guess. Is your score already pretty high? If it is, maybe that's as high as it can get with your current profile.


If it isn't are there other things going on?


I mean I don't know it's like someone saying my car is making a noise is that normal? Well, what noise, when hot cold or all the time, while driving or at idle, what does it sound like, etc. Need more details but if your score is already really good I wouldn't worry about it. Mine didn't go up much for a while either until I got a bunch of credit cards then it really liked that.

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CarefulBuilder14
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Postby CarefulBuilder14 » Fri Aug 29, 2014 12:01 pm

For anyone who might be otherwise confused, my answer relies on info the OP gave in another thread:http://creditcardforum.com/general-credit-card-talk/10539-help-selecting-card-my-needs-difficult.html

Perhaps the good information from the mortgage payments is being offset by the bad information about the jewelry card and student loans? And did you borrow all the money for the student loans at once? Or were there additional borrowings each year or semester?

How old is the Synchrony jewelry card? If it was to buy a ring, I'm guessing you only got the card in the last year or two? 60% utilization on any card, even one with a $1,500 limit, is high. You definitely want the reported utilization to be under 10% - perhaps even closer to 4% or 5% (there is some ambiguity the exact number).

Do you also have at least one other card with a balance reporting each month or being carried from month to month? Balances on multiple cards will hurt your score, even if you pay on time and in full.
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pb576
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Postby pb576 » Fri Aug 29, 2014 1:56 pm

CarefulBuilder14 wrote:For anyone who might be otherwise confused, my answer relies on info the OP gave in another thread:http://creditcardforum.com/general-credit-card-talk/10539-help-selecting-card-my-needs-difficult.html

Perhaps the good information from the mortgage payments is being offset by the bad information about the jewelry card and student loans? And did you borrow all the money for the student loans at once? Or were there additional borrowings each year or semester?

How old is the Synchrony jewelry card? If it was to buy a ring, I'm guessing you only got the card in the last year or two? 60% utilization on any card, even one with a $1,500 limit, is high. You definitely want the reported utilization to be under 10% - perhaps even closer to 4% or 5% (there is some ambiguity the exact number).

Do you also have at least one other card with a balance reporting each month or being carried from month to month? Balances on multiple cards will hurt your score, even if you pay on time and in full.


The loans are taken out each semester, but they are through the government. So there is nothing due on them, etc. They don't pull my credit to do these either. As for the Synchrony card, it's about 18 months old (I paid it off completely for the engagement ring, then added to it again for the bands). My mortgage has never changed my score (even before the synchrony card). So I don't think it has to do with offsetting the bad of that card. Should I call the bank that the mortgage is through? Just a little confused.
As for the utilization, I was under the assumption that I should keep that under 30% to increase the score. Is this correct? Or is it 4-5% like you mentioned?

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CarefulBuilder14
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Postby CarefulBuilder14 » Fri Aug 29, 2014 2:24 pm

pb576 wrote:The loans are taken out each semester, but they are through the government. So there is nothing due on them, etc. They don't pull my credit to do these either. As for the Synchrony card, it's about 18 months old (I paid it off completely for the engagement ring, then added to it again for the bands). My mortgage has never changed my score (even before the synchrony card). So I don't think it has to do with offsetting the bad of that card. Should I call the bank that the mortgage is through? Just a little confused.
As for the utilization, I was under the assumption that I should keep that under 30% to increase the score. Is this correct? Or is it 4-5% like you mentioned?


I don't know why the paying down the mortgage, in isolation of other credit events, isn't gradually improving your score.

There is a little disagreement about the ideal utilization ratio. People report anecdotes about their scores changing and FICO will occasionally give comments. The exact algorithms are pretty secret. 30% may have once been okay, but it isn't anymore. Most credit experts agree on that point. A balance of $1 is, in principle, the perfect balance to report because it is more than zero but also tiny. But most people like to use their favorite cards without calendar restrictions so that isn't usually practical. A $1 balance is theoretically better than a 3% balance, but realistically will give the same FICO score (or at least one in the same narrow range). This is pretty widely accepted.

Some people, but not all, think 7% is noticeably different than 3%. I don't know. Some people think 10% is noticeably worse than 3%. That is probably the case, but it's not hugely worse. No one is totally sure.

Once you get above 10%, most people agree that is going to be clearly worse than $1.

30% is definitely going to hurt. Until you get a card with a limit of several thousand dollars, it is really best to pay in full every few days to keep your utilization down and your score high.

You might also read:http://creditcardforum.com/general-credit-card-talk/10511-balance-reporting-1-10-a.html
Wallet: Prestige CSP SchwabPlat Freedom It Hyatt SallieMae AAPlat
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Letting new accounts cool off since May
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takeshi
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Postby takeshi » Tue Sep 02, 2014 9:08 am

pb576 wrote:Although it does show up on my credit report as paying on time, etc, it has not been increasing my credit score. I have been monitoring this closely for the past 2 years, and it shows no signs of such. Is this normal?

If you're expecting to get X points for each payment you're going to be disappointed. Your mortgage payments are helping your score as long as you have good payment history but you can't expect regular increases for every single mortgage payment. However, you'd certainly see a hit to your scores if your mortgage suddenly fell off of your credit reports.

If you're looking for improvements you probably need to look over the rest of your credit and see if there are negative items that you can address that are limiting you.

CarefulBuilder14 wrote:Perhaps the good information from the mortgage payments is being offset by the bad information about the jewelry card and student loans?

Yup -- derogs are always a major problem. If there are any derogs they should be addressed first as they always have a significant impact.

pb576 wrote:As for the utilization, I was under the assumption that I should keep that under 30% to increase the score. Is this correct? Or is it 4-5% like you mentioned?

They're not mutually exclusive. 30% is a guideline for maximum utilization as in "never exceed 30%". However, lower is generally better as long as you're above 0. You'd have to monitor your scores to determine what's ideal but most seem to think that it's 10% or less.



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