dragnldy wrote:
How do installment loans figure into your utilization? Does FICO figure it only to what you still owe, or does it go by what your high balance was if there was not a specific CL? I have a revolving loan with a $12,600 CL and accessing $5K right now. I also have an installment loan which started out as $1117 and is down to $800.
FICO does count utilization on installment loans in its scoring model, but the effect it has is MUCH smaller than utilization on revolving accounts.
For installment loans, your utilization is the ratio of the loan's current balance to the original loan amount. So the installment loan you mentioned is currently at $800 / $1117 = 72%.
Expect a few points when it goes below 60%, but again, don't expect much because intallment loans just don't count as much as revolving.
For revolving accounts, FICO uses the current balance divided by the credit limit. In the absence of a reported credit limit, FICO will use the past high balance in its place.
Message Edited by cheddar on
04-04-2008 01:32 AM
