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Zero Balance factor into Util %?

New Member

Zero Balance factor into Util %?

I have one account that is active that has a $3K limit and balance of $0 - will this 0% utilization factor into my overall utilization average? 


And is that how it is looked at - by overall average?  Or does it look at the highest util?

 

For example


if i have four accounts with the following utilizations: 78.7%, 80.5%, 75.3%, 0%

 

Is my utilization at 51.2% (including the zero) or 59.7% (not including the zero)?

 

Obviously i have a ways to go to get them down and working on that (last month they were 96%ish)

 

Thanks

 

Message 1 of 6
5 REPLIES
Valued Contributor

Re: Zero Balance factor into Util %?

The account with the zero balance is factored into your utilization, yes. Your utilization % is the total across all credit lines.
Cards: Orchard Bank ($1100) | Cap1 Cash Rewards ($2500) | Chase Freedom ($1000) | Best Buy ($2500) | Discover It ($1000) | Barclay Rewards ($2500) | Current scores: EX FAKO: 684, CK TU: 649, FICO EQ: 680, FICO TU: 698, FICO EX: 658 Happy Homeowner Since 2/6/13! Smiley Happy Last App: 4/5/13 Gardening until July 2014
Message 2 of 6
Valued Contributor

Re: Zero Balance factor into Util %?


MovingForward_2012 wrote:
The account with the zero balance is factored into your utilization, yes. Your utilization % is the total across all credit lines.

Right, and to be completely clear, you don't average utilizations by summing up percents, which only works if all your CLs are identical.   Utilization is total balance/total credit limit

 

Your score can also be impacted if one card has too high utilization, even if total utilization is ok.

Message 3 of 6
Valued Contributor

Re: Zero Balance factor into Util %?

Correct. So if you add more credit without a balance, your Util goes down.
Cards: Orchard Bank ($1100) | Cap1 Cash Rewards ($2500) | Chase Freedom ($1000) | Best Buy ($2500) | Discover It ($1000) | Barclay Rewards ($2500) | Current scores: EX FAKO: 684, CK TU: 649, FICO EQ: 680, FICO TU: 698, FICO EX: 658 Happy Homeowner Since 2/6/13! Smiley Happy Last App: 4/5/13 Gardening until July 2014
Message 4 of 6
New Member

Re: Zero Balance factor into Util %?

Ok - so if i have a total CL of $11500 and total bal of $6176, then my utilization is 53.7%?

 

Message 5 of 6
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Valued Contributor

Re: Zero Balance factor into Util %?


Bella9898 wrote:

Ok - so if i have a total CL of $11500 and total bal of $6176, then my utilization is 53.7%?

 


Yes, (well, I didn't check the math but looks right).  This is the balance showing on your bills that go to the credit reporting agencies, so if you pay some of it before the statement cuts, your utilization is lower.

Message 6 of 6