![]() ![]() The advantage of becoming an authorized user is that if the account holder has a strong FICO score, it will help the authorized user on that account build a strong credit score. Gaming the “authorized user” strategy was effectively stopped.With the introduction of FICO 8, the scoring system stopped paying attention to any accounts sent to a collection agency that had a balance below $100. Small collections squabbles no longer count.FICO 8 tweaked the formula to ding a score more than previous versions if a balance on a single card is near its credit limit. But you also want to avoid getting near to maxing out any single card. As a general rule, keeping your total balances below 30% of your total available credit will not hurt your credit score. This measures how much of your total available credit you’re actually using. One of the most important factors affecting your credit score is your “credit utilization ratio,” which counts for 30% of your credit score. Nearing a credit limit on a single card became more important.But chronically late payments cause your FICO 8 score to drop more. If it’s a one-time slipup, the scoring system is more lenient than previous versions. The FICO 8 scoring model introduced changes to how it treats late payments on a single account. A major factor in calculating your FICO score is your track record for making on-time payments, which accounts for 35% of your score. It takes a more nuanced approach to late payments.Here are four important ways that FICO Score 8 differs from previous versions: ![]()
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