John, does having the statement “Settled for less than full balance” affect your FICO score?
Answer,That’s what’s referred to as a “narrative code.” It’s text that accompanies the account on your credit report and provides additional details about the account. That particular narrative code, obviously, goes on an account when it has been settled. And yes, it is considered negative by the FICO credit scoring system. How negative depends on what else is on your credit report. If that’s the only negative item on your credit reports then it’s having a profound negative impact. If, however, it’s one of many negative items then the impact is much less.
John , I have a 670 FICO score. Is that good? What’s a good score to have? Beverly
Answer – Beverly, a 670 FICO score used to get you anything you wanted, about 5 years ago. Today it doesn’t get you much. 750 is the new “black” so you’ve got some work to do. Anything below 650 is currently considered subprime. There is no blanket answer to what’s a good score. But, a good score is any score that gets you approved at the best deal the lender or insurance company is offering. For some lenders that’s 700, for others it’s much higher. I’d work on getting your scores to at least 750 and then you won’t need to worry about good scores and bad scores. Good luck!! John
I closed a Platinum AmEx because the unlimited credit limit actually shows up on my credit report as $0 credit. I opened an AmEx Blue account instead. Was that a good move?
If your goal is to get an account on your credit report that actually helps your revolving utilization percentage then yes, good move. If you’re referring to the Amex Platinum charge card then it’s not being considered for that percentage in the newer scoring models. You now have a new inquiry on one of your credit reports that could be hurting your score a bit and you will have a new account on all three of your reports that will also probably hurt the scores a little bit. But, in the grand scheme of things having lower utilization is much more important and actually having a card that shows a high credit limit is a good move. By the way, your old Amex card really does have a limit. It’s called a “shadow limit.” Do you really think you can go out and charge an unlimited amount of goods or services on that card?