@kc0039 wrote:10% or less is excellent
FICO appears to round up on this calculation though I never tested it myself on this one, so something under 9% is ideal.
Just leave a yuppie foodstamp worth of balance on a single card ($20) that has a CL over $250 FTW. Doesn't really matter what the number is just non-zero and one balance on a single card is optimal for everyone except maybe very very thin files (1-2 credit cards).
@GA8080 wrote:
Piggybacking on the OPs question... first of all Revelate, can you elaborate on "except maybe very very thin files"? My husband and I each have 1 card in our own names, are AUs on each other's, and each AUs on a parents card. So we each have 3 open accounts reporting. Both parents cards have $0 balances, and the two that we individually have (AUs on each other's) have balances which we can pay off today and plan on doing so before the statement cuts. How does having a thin file effect this? Also does it matter if the 1 card with less than 9% reporting is an AU account? We are preparing to get prequalified for a mort in the next few months
Me:
Cap One: 2700 cl/ 2000 bal
Hubbys Cap One AU: 300 cl/100 bal
Parents BOA AU: 22k cl/ 0 bal
Hubby:
Cap one: 300 cl/100 bal
My cap one AU 2700 cl/ 2000 Val
Parents Kay AU: 12k cl/ 0 bal (just closed due to inactivity last month ugh)
Doesn't matter for mortgage scores which card including an AU has the balance.
By extremely thin files I generally mean 2 or under cards in this case: 3 just have 1 balance other two at zero and you should be as optimal as you can get. The problem with 2 or under cards is the way the algorithms are setup, namely half of cards reporting a balance is a negative, and no cards reporting a balance is a negative, and all cards reporting a balance is a negative... so it's a damned if you do, damned if you don't scenario with 2 cards and it isn't really well characterized unfortunately. Basically have to play with it in that scenario, which is annoying to say the least.
@Anonymous wrote:What is meant by one and only one card with a balance? Can you show a balance on one card this month and a balance on a different card next month?
Sure, it doesn't matter which card shows the balance, you just want a small balance on a single credit card in the perfect FICO world generally.
That's optimal for everyone, some people (like me with a slew of revolvers) can have sloppier balances and not lose any points but the single small balance is a simple way to optimize revolving utilization and when we're talking short term improvements in score, that's a big part of the equation.