My “Credit Score” dropped for this reason...

Ben8282 wrote: »

Your post has started me thinking about the way that different lenders report the 'balances' which are used for the utilisation % calculation and the manner in which by using a different card the amount of these balances can be varied considerably, which is not something that I have previously seen discussed on these boards.
For clarfication, my comments are based on the information contained in my Experian credit files viewed in a printable PDF fabular format devoid of green ticks, commentary and advertising.

The report will show:
Status number
Balance
Payment amount
Previous balance
Promotional rate indicator

The figure used to determine the utilisation % is the balance figure.

leaving aside the strange reporting practices of TSB since their problems last year which I will mention later, the balance figure is the actual balance of the account on the day of the month that the lender happens to report to the CRA. The previous balance is the balance of the previous statemnt (2 months behind the balance figure) and the payment amount is the payment made against the previous balance shown. Where a card is repaid in full the previous balance and the payment amount should be the same.

Now lender A happens to report on what would appear to be the day before payment for that month is due. As this figure is reported each month immediately prior to the full balance direct debit being taken, the reported balance for that month, assuming a constant spend throughout the month, would be about 175% of the average statement balance. Now I am guessing that I just have an unfortunate billing (statement) and payment due date in relation to the day of the month that that lender reports and that, if I were so inclined, this could be eliminated to some extent by a change of statement date. Obviously these ;balances' bear no relation to the previous balance (statement blance) andf payment figure subsequently reported for that period.

Lender B however happens to report on what would appear to be the day before the statrement is produced so that the 'balance' is very close to the actual statement balance which will subsequently appear two months later as the previous balance, completelty eliminating the double balance reporting of lender A.

It will therefore be apparent that by using the ard isued by lender B as opposed to the card issued by lender A, the reported balance and thus the utilisation % will be substantially reduced.

I also mentioned TSB whose reporting is very odd and unlike anything previously encountered. They don't appear to report a statement balance at all. They report a balance in month 1 which is the balance on the day they report which then becomes the previous balance in month 2 and then the payment is sometimes reported in month 3 but sometimes the payments are not reported at all, the impression gained being that no payment was made and the balance has dropped due to a refund or similar.


Another point worth mentioning is that I have access to my Experian credit files through my packaged bank account (which I am very happy with). My credit score is always the same and has not varied by even one point for several years and I am exposed to zero advertising by Experian..