Score Watch is the set-it-and-forget-it credit score product. This product is a subscription service which unlike many monitoring services pushes FICO credit score updates to you in the form of email and SMS cell text messages.
How Score Watch Works
Typically, a consumer will start using this product by pulling one of the 2 reports available, leaving the 2nd one for a later date. Once you get your report, the Score Watch platform keeps a history of your credit scores going forward and is checking to see when your score changes. But it also allows you to be notified in case you change interest rate qualifying bands.
Score Watch has five tabs that make up the product. The tab that means the most is the settings tab. Here you can set the score you want alerts when you reach that target. Next, you can set targets for account percentage increases, dollar increases (e.g. $500) and notification of usage of inactive cards.
The other tabs track your history and also show you
The company was smart about security in that you get alerts that say “ your score has increased by 11 points” instead of saying “your new score is 726”. This is nice should your email or cell phone be compromised at some point.
This is a great product for someone looking to find out exactly when their score peaks to apply for loans at the best time. It also works well as an ID theft product as ID theft would lead to a noticeable score alert.
There is a lot of press around behavioral model induced reductions. Marriage counseling, charging for low price items, even not using your cards risks a credit limit decrease which can hurt your score. There are numerous things you want to do to avoid a credit limit decrease.
1. Read your statements. Don’t go into denial about your statements, that’s where the notice of a credit limit reduction will occur
2. Don’t change your charging pattern. Using credit cards at Starbucks or Peet’s this month when you’ve always paid for these with cash in the past signals that your credit may be shaky and this can lead to a credit limit decrease.
3. Don’t stop using your credit cards altogether. This can lead to signaling as well and some consumers are reporting that this is leading to credit limit declines.
4. Don’t use credit cards for “flags for risk”. Financial institutions are watching your transactions. A charge for marriage counseling can be interpreted as a potential for divorce and thus financial distress. Pay for these services in cash or debit cards.
5. Play the game. Life is often about negotiations. If can prove you need a bigger credit limit, ask for it. Or save this move until the credit limit decrease happens.
If you are married, don’t forget to watch all your authorized user and joint credit cards to see if limits have been impacted. If you are a recent high school grad, or in college, make sure you are watching your credit limits and your credit scores.
Credit limits being reduced is a big story in the media with stories from the WSJ, CNN, and other news agencies.
Here’s some stats from other articles:
A CNN article also illustrates this: Consumer Credit Limit Crackdown.
American Express has reported over twice as many credit reductions have occurred in 2008 versus previous years. Typically, Amex will change the credit limit for 20% of its customers, with 16% getting increases and 4% getting a credit limit reduction.
Starting in summer 2007, Amex gradually tightened its lending. Now, American Express is lowering the credit limits for 10% of its customers, said Kimberly Forde, a company spokeswoman.
62% of credit card issuers have cut back the credit lines they make available to consumers, according to a recent report by Javelin Strategy & Research.
Issuers are cutting down consumer credit lines – sometimes by more than 50%, according to the American Bankers Association (ABA), a bank industry trade group.