Credit Utilization

[DevChatt]

Hello all!

I just joined this forum after a long time lurking around and learning a ton about credit. Currently I believe I had decent credit.I am currently 22 years old. My oldest account is about 17 years (Dad created it when I was a wee one, thank you dad!!) I have a few credit cards in my name, very few I use. The two most notable ones are my PNC Bank Credit Card with a 4500 Limit and my AMEX blue cash card for gas and groceries with a 2k limit which I just opened.

I have two big issues on my credit. Currently I have too many inquiries (over 10), but I am not planning on doing anything else to touch my credit for the rest of this year, so I believe that portion of my score will recover pretty fast.

My other issue is credit card debt. On my PNC card I am at 4100/4500. I just made a payment to bring it down to 3700, and plan on actually bringing it down to 3500 by mid week this week, and in the next week down to 3000-3200 (if all goes well). My question is, which I have not gotten very clear answers on very recently is: If I have such high utilization on this one card, BUT pay it off within the end of this year, maybe even earlier, will I be able to recover my credit score back to before without the high utilization? After paying it off, I don't ever plan on putting my utilization above 20% ever actually. I just hope having this debt on my CC will not hurt me in the future. I put a car on it, and helped out a good friend (with bad credit) with a downpayment for his car on it. 

Any help on this is appreciated. I will stay here for more help.

Thank you.

[100down0monthly]

You'll see your score going up each month your utilization goes down.

[DevChatt]

I guess my question is, will it be restored back to before or will I have a ding on my account that will take longer than me repaying to fix?

[thom02099]

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@DevChatt wrote:

I guess my question is, will it be restored back to before or will I have a ding on my account that will take longer than me repaying to fix?

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Your credit report is simply a snapshot of what your credit actually is, at that particular moment in time.  There's no memory of prior high utilization involved, though high balances in the past will show on your report.  What the report cares about is your utilisation at the time you request your report.  Every monthly statement that your balance and therefore you util declines, you should see a score increase. 

[DevChatt]

Alright, good. Thank you for the information. To clarify, the high utilization will show on my report, but not on a future credit score. Therefore it shouldnt have any negative impact on the score itself but it may have some lasting effects on my report. So to follow up, once the debt is paid off, and lets say, a year or two from now I am in the market for a new car (just a scenario) or any other line of credit. As an underwriter who is manually looking at my credit, will this past high utilization have a negative impact, or if I pay it off quickly, will it look OK?

[guiness56]

No, your past utilization has no lasting affect and cannot be seen by anyone.  The faster you pay it down the faster your score will go up.

Your current utilzation is factored into your current score.  If you have 90% today that is what your score will be based on.  If you have 10% next month that is what your score will be based on.