Utilization Question...

[Kevin7180]

I have a closed line of credit acount (11,500 credit limit)  that I'm paying on. I have 1600 bucks left @ 130/month

I want to make sure I'm figuring my utilization correctly....

I know that the monthy debt factors into my overall debt to income ratio, but how does it factor into my available credit utilization?

I'm wondering since it's closed is it no longer part of the picture?

[john398]

All you need to know is on this

http://ficoforums.myfico.com/t5/Credit-Cards/Closing-Credit-Cards/td-p/347190

Sticky

Also as a note, my credit score went up when closed account was reported YMMV

[Anonymous]

Hi Kevin,

This is how it was explained to me by one of our other mods:

Closed account with no balance, and former credit limit reported: it is excluded from utilization

Closed account with positive balance, and former CL reported: both balance and CL included in utilization

Closed account with positive balance, and $0 CL reported: balance excluded from utilization.

Basically, the rule of thumb is if either the balance or CL on a closed account is reported as zero, it is excluded from utilization.

Hope that's helpful!

ETA:  john398's reference to  Fused's Closing Credit Cards is a great resource for this and other info.  john's just a faster poster than I am

[Kevin7180]

So I take it that because there is still a balance on the account, and the  CL is listed on my CR, it will still be used in my Utilization until it's paid to 0?

Huh... interesting stuff. I'll have to look at my report and see if it shows up that way.