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Regular Contributor
Posts: 214
Registered: ‎03-13-2017
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CC Individual vs Total Utilization

Hey y'all. I just read another post where someone mentioned keeping overall utilization under 30%, which I'm aware of, but they also said each card needs to be under 60% (that number may not be exactly what was quoted, I dont recall). I hadn't previously heard heard about the individual utilization requirement. Is that accurate? 

 

The reason I ask is that I have to have an unexpected surgery in the next couple of weeks, and that, along with some of the pre surgery medical stuff (MRI, etc.) did/is going to cost a pretty penny. My once awesome insurance is now fairly well worthless (thanks Obama). So, I've been footing these bills one one card (to keep it simple). When all is said and done, it's going to raise the util on that card to 80-85%, which I'll be able to pay down/off over the next 5-6 months. My overall util will be around 20%, though. Is having one card that high really going to harm my score, even though my overall will still be fairly low?

Senior Contributor
Posts: 6,718
Registered: ‎04-11-2016

Re: CC Individual vs Total Utilization

Aggregate utilization is far more heavily weighed than individual card utilization.  Recently a member posted on here that he maxed out 1 card, but aggregate utilization was somewhere in the teens and he lost about 20 points.  I wouldn't think that maxing out one of your cards will kill you so long as you keep aggregate utilization down, no higher than the 20's.

Community Leader
Valued Contributor
Posts: 2,421
Registered: ‎08-25-2016

Re: CC Individual vs Total Utilization

I agree with BrutalBodyShots. We just had to replace our entire A.C. System (Not a luxury in South Texas during the summer) and that put one of our cards to about 90% utilization, which will be paid off by December. Our overall utilization is now roughly 24% and we only list 20-29 points depending in the bureau.
Regular Contributor
Posts: 214
Registered: ‎03-13-2017
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Re: CC Individual vs Total Utilization

God bless y'all for having scores high enough where 20-30 points is no big deal (I'll get there someday), but for a rebuilder like me (in low to mid 6's), that type of drop will hurt!

 

I've already paid the bulk of it on the one card, so I don't think I'll be able to do much damage mitigation, but I'm darn sure going to try and spread the rest out over a couple of cards.

 

Thanks for the input, guys.

Senior Contributor
Posts: 6,718
Registered: ‎04-11-2016

Re: CC Individual vs Total Utilization

Also keep in mind that if you aren't planning on applying for credit any time soon, a credit score drop of 20-30 points is a non-event.  The only time 20-30 points will really matter for your score is when you are looking to obtain additional credit.  That's when you want your score to be at its absolute best.  Don't sweat the temporary score drop!

Regular Contributor
Posts: 214
Registered: ‎03-13-2017

Re: CC Individual vs Total Utilization


BrutalBodyShots wrote:

Also keep in mind that if you aren't planning on applying for credit any time soon, a credit score drop of 20-30 points is a non-event.  The only time 20-30 points will really matter for your score is when you are looking to obtain additional credit.  That's when you want your score to be at its absolute best.  Don't sweat the temporary score drop!


Excellent point. Thanks for talking me down from the edge...

Senior Contributor
Posts: 6,718
Registered: ‎04-11-2016

Re: CC Individual vs Total Utilization

No problem.  There is one rare asterisk that I'd put on a temporary 20-30 point drop being a "bad" thing and that would be if you've had any recent negative items introduced to your credit report, such as a late payment in the last 6 months, for example.  An additional drop from utilization following a drop due to payment history could and has spooked lenders to taking AA.  Most of this IMO would happen in the score range of say 580-620.  Here's an example:

 

Someone has a score of 700 with no recent negative items and their utilization is very low.  They let one of their accounts report a 30 day late payment.  Their score instantly drops to say 620.  Lenders at this point when they see the late payment may take AA, or they may not.  If they saw the account go to 60 days late, no doubt AA would be taken.  But anyway, at 30 days late with a 620 score this person increases their utilization by maxing out a single card and their score drops to 595-600.  At this point, lenders may consider taking AA because in addition to the negative information being reported, now utilization is showing the first signs of struggle as well.  Again, this would only happen with those "on the cusp" type scores.  I just thought this type of situation would be worth pointing out as an example where/when someone would not want to take a 20-30 point utilization hit. 

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