Money Matters
labro
member
Dear Community,
Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Credit Scores
So my bank has been sharing my Experian credit score with me for a few months now as an additional widget on my home screen. It went down while we were paying off the car loan but since then it's jumped back up again. So I'm curious, I know banks use a blend of Experian, Equifax, and Trans Union to come up with your FICO score right? Where does Experian generally fall among the three? Is it the highest? Somewhere in the middle? Lowest?
I've been doing some googling but not getting an easy answer. We aren't planning on taking out any loans anytime soon, this was just a point of curiosity.
Question #2 - I know part of your score is based on your credit utilization, ie, how much of your credit you're using each month, say on a credit card. Do they determine credit utilization based on your monthly statements or is it based on a rolling balance/you aren't paying off your balance every month. DH and I pay our credit card balance in full every month, sometimes twice in one month if it seems like we're spending more than usual, but we use the credit card for most of our monthly bills and all of our purchases.
I've been doing some googling but not getting an easy answer. We aren't planning on taking out any loans anytime soon, this was just a point of curiosity.
Question #2 - I know part of your score is based on your credit utilization, ie, how much of your credit you're using each month, say on a credit card. Do they determine credit utilization based on your monthly statements or is it based on a rolling balance/you aren't paying off your balance every month. DH and I pay our credit card balance in full every month, sometimes twice in one month if it seems like we're spending more than usual, but we use the credit card for most of our monthly bills and all of our purchases.
Re: Credit Scores
Question 2 - I believe they determine credit utilization based on the statement balance (or whatever the balance happens to be when the credit bureaus report). Believe it or not, having a balance on some cards when they get reported can boost your credit score slightly. However you obviously do not want to pay interest. So I let our cards close, and then I pay them off during the grace period. That way a balance gets reported to the bureaus, but I am paying no interest. If the balance gets very high due to some reimburseable or planned big expenses I usually pay those off mid-month, but I always make sure we have some cards that close with a balance.
Example - most of our cards close on the 27th of the month. I then pay them off on the last day of the month. That way our current month's income lines up with our current month's expenses for budgeting purposes, we pay no interest on our purchases, and the credit bureaus can see that I'm using credit instead of always reporting a 0 balance. We have a lot of credit extended to us on cards - collectively it's around $175K/month (not a typo) - so our percentage of utilization is extremely low, but never 0.
H and I both have credit scores in the 820-840 range (depending on which bureau you pull) by doing it this way.
I think at the level we're both at it would be tough to get our scores much higher...we're in the same range as you, but it was something I was curious about.
I've never paid for them and honestly, I pull very rarely (as in years apart). So it's possible the formats may have changed.
I use Credit Karma. The credit scores they give to you are "estimates", but then there isn't any charge to set up an account and you can look at what is going on with your credit report and score at any time. I've also found them to be fairly accurate. If anything, they estimate a bit lower than my actual scores. Credit Karma does show all the lines of credit you have on your report, including the balances.
That part of their service is accurate...or at least as accurate as the last time credit cards/loans updated a person's credit file. That seems to happen once every month or two, depending on the institution reporting. It seems like it usually happens within a week or two of my statement closing, but is a bit random.
They also have a neat "credit simulator" where you can put in a scenario...like paying all your credit cards off OR adding to the balances...and it will give you an estimate of what your credit score will look like after that.
I've never noticed much difference in my score between the three credit bureaus.