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Why did my score drop 38 points with no new negative items?

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Maintain a Low Revolving Balance with CC

To most educated and reasonable people, it seems ridiculous and counter-intuitive – perhaps even outrageous and unreasonable – that a credit score would generate fewer points when every credit card or revolving balance contained on the consumer report is updated with zero balances owing.  And that may be the explanation for the 38 point loss you've indicated.  In other words, despite this seemingly irrational reality, it’s a fact that having less outstanding and reported debt can - and does - result in lower credit scores.

To expand and clarify this point further, when a credit score is generated at the very moment the file contains no reported revolving balances outstanding, this will result in a lower credit score. While this may not be demonstrated for every unique credit scenario, this fact is certainly true among consumers who otherwise generate high percentile credit scores.

Consumers should understand that a loss of points in this otherwise counter-intuitive situation is the result of predictive analytics.  Despite comments from conspiracy-theorists and others, it’s not because model developers want to confuse, trick, or fool the nation’s credit consumers. Rather, in the absence of (responsible) revolving utilization, the scoring algorithms calculate and assign fewer points. Why? Because it’s an empirically derived fact - from a statistical evaluation of millions of consumer credit reports - that individuals who maintain an active ‘mix’ of credit (i.e. an installment loan with one credit card balance), they are proven most reliable from the standpoint of their credit reports and future payment behavior.

It’s a point worth noting that predictive analytics and rank-order technology flow form highly refined and sophisticated processes that evolve over time and with changing economic and financial realities (i.e. FICO 8 vs. FICO 9; Vantage model updates). These processes are typically created by highly trained and experienced PhD mathematicians, statisticians, scientists and other experts who have no interest other than making their models highly accurate.

FICO, Equifax, Experian, and TransUnion, including every model developer, all understand that they must produce incredibly accurate credit scores and rules based decision management technology to survive and remain competitive. If they don’t, FICO and the other organizations know well that businesses will simply not continue making the substantial investments required to purchase this technology. In other words, FICO and similar organizations will be out of business if they don’t get it right.

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I'm under the impression that these scores are artificially manipilated to suit the credit card fancy so they can get you to do the things they can benefit from.

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