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To PIF or not to PIF?

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myjourney
Super Contributor

Re: To PIF or not to PIF?


@PastorH wrote:

Thanks myjourney.  I'll continue to count on you as the garden grows.


We all want to see your garden blossom and will be here when you need us.......Count on itSmiley Wink

Before you app think...
Have you done your research of the CC?
Does it fit your spending?
Do you have a plan for the bonus w/o going into debt?
Can you afford the AF?
Do you know the cards benefits? Is it worth the HP?
Message 41 of 42
mnscoutNYC
Member

Re: To PIF or not to PIF?


@Anonymous-own-fico wrote:

@mnscoutNYC wrote:

The problem as I see it is your Chase Amazon card and to a lesser extent JCP. Your utilization rate on Amazon is over 60%. That's a huge red flag, and that is what's bogging down your credit score, well most probably. It's irrelevant IMHO, when exactly you pay off your other credit cards as long as you pay them in full every month.


 

A maxed out card may actually affect one's credit score less than commonly thought, which could be a decrease of 40 points. Having small balances on all of your cards too may take away something like 40 points.

So reporting balances on all cards (100% of the cards) may roughly decrease your score about as much as having one card reporting but which is maxed out (a 100% utilization). And if you have balances on half of your cards (50%), the same damage may come from the one card reporting whose credit is used halfway up (50%). So my theory is that the percentages match.

Thak


@Anonymous-own-fico wrote:

@mnscoutNYC wrote:

The problem as I see it is your Chase Amazon card and to a lesser extent JCP. Your utilization rate on Amazon is over 60%. That's a huge red flag, and that is what's bogging down your credit score, well most probably. It's irrelevant IMHO, when exactly you pay off your other credit cards as long as you pay them in full every month.


 

A maxed out card may actually affect one's credit score less than commonly thought, which could be a decrease of 40 points. Having small balances on all of your cards too may take away something like 40 points.

So reporting balances on all cards (100% of the cards) may roughly decrease your score about as much as having one card reporting but which is maxed out (a 100% utilization). And if you have balances on half of your cards (50%), the same damage may come from the one card reporting whose credit is used halfway up (50%). So my theory is that the percentages match.


Thanks for the link. Very interesting article. The thing is that while it's true that they are looking for the UR across all your revolving accounts, many sources recommend to avoid an exessive UR on one particular account even if others are under-utilized. Credit Karma, for example, recomends not to use over 30% UR on any one of your accounts. Now, I don't claim the ultimate knowledge, and it would be interesting to find some real confirmation or rebuttal of this theory, but I still believe the OP would be better off "spreading" his debt among several cards rather than having one with 60%. Just in case. But again, as long as FICO closely guards their secrets, all we can do is speculate and use our experiences to see what's working and what is not.

Message 42 of 42
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