Credit Cards

[tianapb725]

Does FICO penalize you for having too much available credit?  I have high credit limits on a few of my cards with low utilization.  I use less than 10% on all of my cards.

[cheddar]

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tianapb725 wrote:

Does FICO penalize you for having too much available credit?  I have high credit limits on a few of my cards with low utilization.  I use less than 10% on all of my cards.

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No, FICO does not penalize you for having a lot of available credit.  Some lenders may deny you new credit for this reason, however, and some mortgage lenders in particular may require that you lower the limits on cards or close them altogether as a condition of getting a loan.  This only applies if you have a WHOLE lot of available credit.

If I may ask, how much available credit are we talking about?

[CreditMizer]

Funny story about FICO and CL. 

When I was growing up my mom didn't work (well she "worked" 80+ hours a week raising 4 kids).  So her income was essentially $0.  Now my dad credit score likely was a 350.  My mom had perfect credit.  My dad started a business building computers (long time ago - 1980s) when computers were still big and expensive and margins were nice.

The credit cards were in my mom's name since my dad's credit was so bad.  Started out small $5K limits.  Then couple cards.  Then 4-5 cards with $20K-$50K limits.  Then first $100K limit card.  When I went to college my mom finally started working again after 20 years.  Her total revolving CL was almost $500K and her credit score a 780 all that with an income of $0.  It kinda was just a snowball effect my mom's credit was so good that they could get better rates by putting everyting (except mortgage) in my mom's name that they never rebuild my dad's credit instead my mom's credit just kept getting better and better. 

Due to the volume of purchases from the business I am sure the computer model thought my mom had an income of close to a million dollars.  Computer models don't always get everything right.

[tianapb725]

My balance and credit limits are as follows:

Amex: $1300/$10000

Citicard: $500/$8000 (PIF Every month)

Chase: $0/$4000

Discover $140/$3100 (PIF every month)

Best Buy: $1100/$4000 (I financed a laptop for my sister)

Home Depot: $0/$2400

NY&Co: $0/$610

Juniper: $0/$3000