Credit Score Secrets Revealed: FICO Negative Points

We’ve known for a while now what actions will negatively affect your credit score and what steps to take to improve your score. But what we haven’t known is the specific number of negative points you’ll be hit with for certain actions.

Liz Weston, Financial Columnist and friend, recently showed of her persuasive skills by getting FICO to release specific information about the point hits you’ll take from certain negative credit actions (see 5 Ways to Kill Your Credit Score). Liz claims she just had to ask. Here’s how the points break down:

FICO Damage Points

Some things I noticed about the newly released FICO info:

1. Progressive Punishment from FICO

The negative action (late payments, maxed-out card, etc) will affect those with higher scores more drastically that they will someone with a lower score. This seems unfair to me. But who says FICO has to be fair, right? They get to make up their own rules.

2. Multiple Dings Not Addressed

What the chart doesn’t explain is how the scores are affected when you hit a couple of these actions at the same time, or within the same month. For instance, let’s say you max out your card and then you pay it late by 30 days. Will you take a 150 point hit if you have a 780? Then, what happens if you have a 60 day late hit the next month? Another -100 points? I would assume that the scores wouldn’t compound on each other directly like that. But that’s just my assumption.

3. Bankruptcy Evens the FICO Score

One thing that Liz points out in her article is the fact that where the other dings don’t necessarily reduce the 680 and 780 score to the same levels, the bankruptcy pretty much puts them both around the 550 mark. I guess this shows how important the bankruptcy is to FICO. They’ll simply flat line you if you do it, regardless of your history.

4. What This Means in Dollars

Dings to your credit score only really matter if your going to be using that number in the future. Will you need a home loan, car loan, or credit card? Your FICO score will affect your ability to get a good interest rate on that loan. The higher your score is, the better interest rate you’re likely to get, and the less you’ll pay in interest charges throughout your life. So how do these damage points translate into dollars? Jeremy Simon at put together a great analysis which shows how much the FICO damage points cost you in dollars.

5. Look at the Positive

It’s not all negative. What I take from this chart is that FICO is likely to also reward me for consistently doing a couple of things right: paying on time and keeping my credit card balances low compared to my available credit.

What are your thoughts on the FICO “damage points”?

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About Philip Taylor, CPA

Philip Taylor, aka "PT", is a CPA, blogger, podcaster, husband, and father of three. PT is also the founder and CEO of the personal finance industry conference and trade show, FinCon. He created this website back in 2007 to share his advice on money, hold himself accountable (while paying off over $75k in debt), and to meet others passionate about moving toward financial independence. He uses Personal Capital to track his wealth. All the content on this blog is original and created or edited by PT.


  1. I think the credit score/ FICO system is all HOGWASH….i pay my bills on time every month and my score goes down and down…..i might as well just stop paying and go bankrupt

  2. Sioux falls cars says

    I never had any idea that is all a BK would hit your score. Or is this saying you can expect some combinations of “hits” to impact your score?

  3. Good to know you can quickly recover, DK. Thanks for giving us the insight.

  4. As someone who had a recent bankruptcy, I can pretty much confirm those numbers.

    But, I think you can recover fairly quickly. I was down in the low 500’s after my BK, but as of Sept of this year, I’m up to 663 on Equifax. My bankruptcy was discharged in early 2008. Not that long ago.

    I haven’t been denied credit yet because of my BK, but I haven’t applied for hardly anything either, only a few secured cards to get the score going again.