Ten years post BK: How much could FICO score increase?

[bluemartini]

This December it will have been 10 years since I filed Chapter 7, and I'm very much looking forward to seeing what happens to my credit scores.

Checking this morning I see I've got 711 with Equifax, 709 with Experian and 679 with Trans Union.

Can anyone share how much their credit scores increased? I've been googling and haven't been able to locate much info other than one blogger who said his scores went up an average of 60-70 points. Others said their scores actually dropped for whatever reason. Thanks in advance for any insights you can share.

[shipo]

bluemartini, this is an easy one to answer; "It depends."

Yeah, I know, something of a dodge, but it truly does depend upon how much credit you've been able to get over the last decade, how you've maintained your debt, your debt to credit ratio, and on and on and on...

My wife declared Chapter 7 back in 2014 and has since gotten a half-dozen credit cards, purchased a new car (and is only a few months from the final payment), and her FICO has gone up about 55 points in six years. Our former neighbor declared Chapter 7 at about the same time and her FICO is up almost 150 points over the same period of time, not only has she purchased three cars (one new for her and two a few years old for her kids), but she has also purchased a new home.

Then there are the folks whom are still in rough financial shape right after they have their bankruptcy discharged, and never really get out of the hole; their FICO is likely to tank pretty hard.

In my case, I just had my Chapter 13 discharged in early March, and the day after said discharge, my FICO was an astounding 717; I've applied for a few credit cards since (three denials, one acceptance) and my FICO is now standing at 710. It will be interesting to see where it is in another year, and again the year after when the bankruptcy drops off my record (Chapter 13s drop off your record after a total of 7 years).

[justbroke]

There is no way to gauge because each person's credit profile is different; even across the 3 major bureaus it can be different. Whether or not you receive a small or major bump, will depend on your credit profile at the time that the BK drops off. Generally, someone 2 years outside a Chapter 7 discharge should already be in the (very) low 700s.

So I echo what shipo has posted. It really does depend.

[bluemartini]

Ok, thanks.

I have very low debt to credit ratio. I got some store credit cards and a couple of MasterCards not long after the bankruptcy. Over the past 10 years I've paid everything off every month, so no balances or debt.

I don't have a car loan or mortgage. After the bankruptcy I got married and my husband's home is paid for. I think my FICO would be higher if I had taken on a car loan these past few years. But I didn't want to get a new car until I could either pay cash for it or make a substantial down payment and I'm not quite there yet. So for the meantime I'm driving my 2001 Honda clunker.

I'm not sure why my Trans Union score is so much lower than Equifax or Experian -- I went over the Trans Union report with a fine tooth comb and everything is correct. Oh well. I'll just wait until December and see what happens!

I do hope it goes up because one of the things that happened after I got married, was that my husband's FICO went down -- from mid 800's to low 700's. He didn't do anything differently -- didn't take on any debt, didn't default on any debt, didn't change his income, just continued doing everything the same. The only thing different was that he married a woman who had just come out of bankruptcy. He doesn't care too much because he never finances anything. Still -- since I know this is my fault, I'm hoping that when the BK falls off in December that BOTH of our FICO's will go up. Fingers crossed.

Thanks again for the input.

[justbroke]

I do hope it goes up because one of the things that happened after I got married, was that my husband's FICO went down -- from mid 800's to low 700's. He didn't do anything differently -- didn't take on any debt, didn't default on any debt, didn't change his income, just continued doing everything the same. The only thing different was that he married a woman who had just come out of bankruptcy. He doesn't care too much because he never finances anything. Still -- since I know this is my fault, I'm hoping that when the BK falls off in December that BOTH of our FICO's will go up. Fingers crossed.

Being married is not a factor in the FICO score. What can change, over time, is how things are weighed. As you may nkow, there are many version of the FICO scoring models and they have changed significantly over time. Each scoring model may pay more attention to one thing, than another. For example, one of the major factors in the newer scoring models (e.g. FICO 8 and FICO 9) is that they want to see installment debt (e.g. a car, student loan, personal loan) and even like it when there is history of real estate installment loans. These models are complex.

The models also take into account trends as well. The current FICO model is FICO 8, but FICO 9 is gaining traction. My FICO 9 scores are lower than my FICO 8 scores because FICO 9 looks at debt differently. Even my older "mortgage" scores (FICO 2, FICO 4, and FICO 5) are higher than my FICO 8 scores!

So the variety of models used by different banks for different reasons will yield different results. No one will ever be able to explain why you can have the same exact trade lines on Equifax as Experian yet the Experian score (scored with the same FICO model, such as FICO 8) are different!

Welcome to the black magic of FICO models.