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Utilization%.....

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theREBIRTHofCREDIT
Regular Contributor

Utilization%.....

Advise given...Always keep utilization @ 1-9% on revolving credit accounts (OK)
 
I have a HSBC mastercard with $300 limit ($189 balance)
I have a NY&C store card with $300 limit ($0 balance-haven't used in 2 yrs.)
I have a Dell Financial account with $1500 limit ($0 balance as of 11/07)
 
ALSO...car loan $14,000 balance and student loan $17,000 balance (installment loans)
 
Q1: As far as utilization is concerned, am I safe or should I pay down my HSBC card?
Q2: Should I pay to a $0 balance or ALWAYS keep 1-9% on ALL (revolving)?
Q3: How is installment loans factored into this utilization%?
 
Thankx in AdvanceSmiley Wink
theREBIRTHofCREDIT
Goal Score 680+
Start Score ........ 2/05/14: ...EX 612 -TU 575 -EQ 567
Current Score .... 5/02/14: ...EX 652 -TU 655 -EQ 646

I almost paid for credit repair......until I found myFICO!!!!!
Message 1 of 5
4 REPLIES 4
Anonymous
Not applicable

Re: Utilization%.....

q1 if you can pay it down do it
q2 fico like 1-9% reporting, you can revolve it or make a payment before statement cuts, then pif after statement cuts to avoid charges. will invlove at least 2 payments a month.
q3 instalment loans aren't scored the same as revolving accounts


Message Edited by dnm45227 on 11-18-2007 12:06 AM
Message 2 of 5
haulingthescoreup
Moderator Emerita

Re: Utilization%.....


@theREBIRTHofCREDIT wrote:
@Advise given...Always keep utilization @ 1-9% on revolving credit accounts (OK)
I have a HSBC mastercard with $300 limit ($189 balance)
I have a NY&C store card with $300 limit ($0 balance-haven't used in 2 yrs.)
I have a Dell Financial account with $1500 limit ($0 balance as of 11/07)
ALSO...car loan $14,000 balance and student loan $17,000 balance (installment loans)
Q1: As far as utilization is concerned, am I safe or should I pay down my HSBC card?
Q2: Should I pay to a $0 balance or ALWAYS keep 1-9% on ALL (revolving)?
Q3: How is installment loans factored into this utilization%?
Thankx in AdvanceSmiley Wink
theREBIRTHofCREDIT



Q1: Pay down the HSBC to under 10%. The easy way to figure 10% is to knock the last zero off the credit limit --that's 10%. So that card should report under $30. You can use it through the month, just be sure to pay it down before it reports.

Q2: Only let half or fewer cards report a balance; the rest should be $0. So for 3 cards, only let one report.

Q3: Installment loans do not count in util --that's strictly on revolving credit. Don't worry about your installment loans. Just keep current on them. Avoid any consumer finance loans.

FICO looks at overall revolving utilization (ideally under 10%), and individual account utilization (the same.) So just because your overall is low, doesn't mean that you can have one card with a high balance, and not get penalized.
* Credit is a wonderful servant, but a terrible master. * Who's the boss --you or your credit?
FICO's: EQ 781 - TU 793 - EX 779 (from PSECU) - Done credit hunting; having fun with credit gardening. - EQ 590 on 5/14/2007
Message 3 of 5
Anonymous
Not applicable

Re: Utilization%.....

Hello,
 
To find an answer to the questions you have as well as a wealth of knowledge about credit, please check out the "Credit Scoring 101" thread which can be found at the following link:
 
 
Robo
Message 4 of 5
fused
Moderator Emeritus

Re: Utilization%.....

FICO scoring does have util% calculations for all non-mortgage installment accounts but revolving accounts carry considerably more weight.
Message 5 of 5
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