What's your experience w/ bal and util for score increase?

[Thomas_Thumb]

I agree with your approach. I let all cards report full balances and then pay each in full a few days before the due date. That way I get to maximize float on money. Been doing it that way over 30 years. 

If you have aggregate CL in a good ratio to spending habits, aggregate UT% naturally falls in-line. Statements come, wait a few days, PIF, no worries. The key is getting CLs in balance on a per card basis and overall. Generally 5 to 8 cards are needed to achieve a balance with flexibility to absorb monthly spend variations.

However, others, such as the OP, want to "optimize" score so advise is geared toward what the OP is asking for. Of course, past history for utilization % and # cards reporting a balance are not considered in future scores so really no real value in using these optimizing tactics except perhaps prior to applying for new credit. Still, optimizing can help create discipline in credit management.

[Anonymous]

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@Thomas_Thumb wrote:

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@Anonymous wrote:

Thanks everyone for the feedback. It gives me insight as to different methods I can try and know what works for others. Hopefully more members will chime in so I can see more opinions.

Thomas_Thumb:  I see the idea you're mentioning.  Makes sense to me if one is a little higher but overall your util is low. Question is if the scoring systems see it that way.

JustMe3:  I also don't want the stress of micromanaging. (like I'm doing now) but I figure once I'm comfortable with a method or way of maintaining, it'll be easy for me to just make it routine. 

More than likely, I'll stick with one way until I hit a plateau. If I see it doesn't continue to improve, then it might make sense to bring in change. 

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Yes, the scoring models do allow for a specific card to report a reasonably high balance without "dinging" your score as long as overall utilization is kept "in range". I allow my aggregate utilization to float between 1% and 6% month to month - without change in any of my Fico scores. I also have personally reported balances on a specific card in excess of 30% without negatively impacting score [Note: aggregate UT still maintained under 6% in these situations]. 

There is plenty of data on various MyFico threads that validate UT% on a specific card can be well over 10% without negatively impacting score [again, need to maintain aggregate UT% in range]. Here is an example - in both cases assume AG UT is 6% and you have 3 cards - each with the same 3K credit line. [total spend = $540]

Case I :  Card 1 = $540, card 2 = 0, card 3 = 0, UT on card 1 = 18%, AG UT = 6%

Case 2: Card 1 = $180, card 2 = $180, Card 3 = $180. Each card has 6% UT and AG UT = 6%

For typical profiles (like yours) actual data from other posters indicates Case 1 scores will be 10 to 20 points higher than case 2 scores. You are penalized for "too many open accounts showing a balance". This has been well documented and holds true for most profiles/situations. Conversely, here is no penalty in case 1 - because you are not using all your open accounts at once and because the relatively low 18% card UT is not a negative factor in scoring. 

Now assume card 1 had a $6k CL and the other 2 cards are $1.5k each.

Reporting a UT = 18% on card 1 and no balance on cards 2 and 3 triggers a score drop. Why - because aggregate UT is now illustration is 12% - above the 9% generally accepted as a threshold for a score change trigger. The card UT = 18% is not the score change trigger.

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Thanks. This is the type of breakdown that can help me understand how it works out. I understood and followed all the way until that last paragraph.  That last paragraph has me a little confused, but I imagine it's due to the last two cards having such a low credit limit. And i think it also has to do with what you mentioned in your next post about trying to get your cards balances in line.  I dunno. I know I'll keep reading all these posts and yours until I have full clarity. I was good all the way until that last paragraph....so I think I get the gist of it.  I appreciate the breakdown and examples. It helps alot.