Too many cards with balances

On EQ5, when I have more than 2 cards with balances, I get reason code 23, "You have too many credit cards and/or open-ended accounts carrying balances." I might lose as much as 7 points for when I go from 2 to 3 cards with balances. I'm unsure of the exact number of points lost because of conflation with Accounts With Balances, but I know there's a threshold at 3 cards because I have seen the reason in third position there, and it vanishes when I go down to 2.

I think I see hints that 3 is treated the same as 4, but there's another threshold and bucket at 5 & 6.

How many total cards / accounts do you have on your CR?

Do you think it's a hard number (3 verses 2) or a percentage threshold being crossed?

12-13 cards when it has appeared. 28-29 accounts. Hard to say for sure, but my hunch is it's a raw number, not a percentage. Here's the explanatory text shown on MF: "FICO® Scores consider the number of credit cards and/or open-ended accounts being reported with a balance. Generally speaking, high FICO® Score achievers carry fewer credit cards and/or open-ended accounts with balances. Note, even if a credit card is paid in full, the balance from the most recent statement may be the amount reported." The thing that got me thinking about this was a comment from Tom Quinn in the Reddit AMA. In response to a question about why there are many different versions of FICO scores, he said: "To help lenders make more informed credit-granting decisions, the FICO® Score model has been updated periodically over the years. As an example, consumers use credit much more frequently nowadays than in the past. FICO Scores have been updated to reflect this change in behavior. The result is that there are multiple FICO Score versions in the market." (emphasis added) In the era when FICO 2/4/5 were developed, rewards cards hadn't exploded yet, so there were fewer "good" reasons a consumer would actively use multiple cards. When they did so it was probably a pretty strong signal that they were getting in financial trouble. That would have been true whether the consumer had few or many cards on their report, so I think percentages would have been less predictive of risk than raw numbers. It's inconceivable to me that the data scientists would have seen equal risk in the population of people with balances on 1 of their 2 cards as they did in the population with balances on 4 of 8 cards. I also happen to think AWB may be more heavily weighted towards raw numbers than is generally believed, but that's a topic for another day and another thread.

Equifax uses 1/3rd cards with balance for too many cards with a balance, the other two use 1/2 cards with balance for too many cards with a balance. That's why it's always said that you need at least three cards and only one with a balance for optimal scoring.

Saeren wrote: ↑Mon Jan 31, 2022 1:53 am Equifax uses 1/3rd cards with balance for too many cards with a balance, the other two use 1/2 cards with balance for too many cards with a balance. That's why it's always said that you need at least three cards and only one with a balance for optimal scoring.

That's always what I thought, but if @Justaguy above is seeing that negative reason statement appear with only 3 cards reporting a balance, that is less than 1/3 of his cards if he's got 12-13 total.

BrutalBodyShots wrote: ↑Mon Jan 31, 2022 7:28 am

Saeren wrote: ↑Mon Jan 31, 2022 1:53 am Equifax uses 1/3rd cards with balance for too many cards with a balance, the other two use 1/2 cards with balance for too many cards with a balance. That's why it's always said that you need at least three cards and only one with a balance for optimal scoring.

That's always what I thought, but if @Justaguy above is seeing that negative reason statement appear with only 3 cards reporting a balance, that is less than 1/3 of his cards if he's got 12-13 total.

I have never heard of that before and would be surprised if it's not a glitch. Equifax's systems leave a lot to be desired.

Not sure what kind of glitch it would be.

Just realized my CWB was 3/14 (21%) when I got this reason code this month.

The lowest I had ever heard was enough to trigger that before was 25% but I had only ever heard of that once before so congratulations on finding a new low?

Meanwhile I haven't managed to trigger mine when I had 8/19 with a balance.

Scoring inconsistencies like this are why people have no faith in scoring.

Saeren wrote: ↑Mon Jan 31, 2022 2:21 pm Meanwhile I haven't managed to trigger mine when I had 8/19 with a balance.

Could it be that the reason code for this is too far down the list on your profile to see perhaps? Also, are you speaking about EQ5 specifically as well?

Justaguy wrote: ↑Mon Jan 31, 2022 2:01 pm Not sure what kind of glitch it would be. Just realized my CWB was 3/14 (21%) when I got this reason code this month.

This Metric we have called BWB, bankcards with Balance, to differentiate from AWB & retail, interesting that you’ve isolated that.

BrutalBodyShots wrote: ↑Mon Jan 31, 2022 3:36 pm

Saeren wrote: ↑Mon Jan 31, 2022 2:21 pm Meanwhile I haven't managed to trigger mine when I had 8/19 with a balance.

Could it be that the reason code for this is too far down the list on your profile to see perhaps? Also, are you speaking about EQ5 specifically as well?

I always have time since most recent account opening is too short and length of time accounts have been established. I can't see 3 years 3 month AAoA and over 11 years AoOA being a bigger score penalty than too many accounts with balance but maybe? Yeah, it's my EQ5 from DCU.

I just went through all the reports I have at Experian and unfortunately I don't have the DCU for the one month that EX2 dinged me for accounts with balances because that was February of last year and my DCU only goes to April... Interestingly though, that happened with only 4 cards with a balance (the FICO score says 5 but I just checked the report and it shows 4 cards and an installment loan balance). I had 19 cards at the time and a CLOC.

I guess there is more variability here than I thought.

I also got slapped with it by EX2 in 11/2020. 3/19 cards with a balance and 1 installment this time.

Saeren wrote: ↑Mon Jan 31, 2022 7:05 pm

BrutalBodyShots wrote: ↑Mon Jan 31, 2022 3:36 pm

Saeren wrote: ↑Mon Jan 31, 2022 2:21 pm Meanwhile I haven't managed to trigger mine when I had 8/19 with a balance.

Could it be that the reason code for this is too far down the list on your profile to see perhaps? Also, are you speaking about EQ5 specifically as well?

I always have time since most recent account opening is too short and length of time accounts have been established. I can't see 3 years 3 month AAoA and over 11 years AoOA being a bigger score penalty than too many accounts with balance but maybe? Yeah, it's my EQ5 from DCU.

Not AWB, BWB.

Birdman wrote: ↑Mon Jan 31, 2022 7:17 pm

Saeren wrote: ↑Mon Jan 31, 2022 7:05 pm

BrutalBodyShots wrote: ↑Mon Jan 31, 2022 3:36 pm Could it be that the reason code for this is too far down the list on your profile to see perhaps? Also, are you speaking about EQ5 specifically as well?

I always have time since most recent account opening is too short and length of time accounts have been established. I can't see 3 years 3 month AAoA and over 11 years AoOA being a bigger score penalty than too many accounts with balance but maybe? Yeah, it's my EQ5 from DCU.

Not AWB, BWB.

Ah, gotcha. Nevermind me, I'm gonna go take a nap. lol.

Birdman wrote: ↑Mon Jan 31, 2022 6:59 pm

Justaguy wrote: ↑Mon Jan 31, 2022 2:01 pm Not sure what kind of glitch it would be. Just realized my CWB was 3/14 (21%) when I got this reason code this month.

This Metric we have called BWB, bankcards with Balance, to differentiate from AWB & retail, interesting that you’ve isolated that.

Wait… when you use the term “bankcard,” do you intend it to include cards like Amex charge cards?

Saeren wrote: ↑Mon Jan 31, 2022 7:05 pm I always have time since most recent account opening is too short and length of time accounts have been established. I can't see 3 years 3 month AAoA and over 11 years AoOA being a bigger score penalty than too many accounts with balance but maybe? Yeah, it's my EQ5 from DCU.

I think it would depend on how many accounts with a balance you're talking. If you're just talking the first threshold ding (which I think is what we're targeting here), I could see that being equal to or smaller than an aging related reason statement. Naturally if you're talking more and more BWB the chances of that factor being more impactful increases.