Credit Card Payoff Dilemna!!!! HELP!!

[Anonymous]

Hi Guys,

I have a question I can't quite seem to answer. I understand that MYFico score looks at overall credit utilization but does the score break it down even further to the credit utilization on each card?

I have two cards at near 100% utilization. Which scenario would increase my FICO score more in the short term?

1) Payoff one credit card completely and leave a second card at near 100% Utilization?

2) Divide the cash between both cards and bring both to around 50% utilization?

3) Won't make any difference - don't sweat it! 

Both interest rates are comparable and I'm just looking for the best FICO score increase. Both cards should be payed off in the year but I'm starting to look at buying a house and I want to position myself as nicely as I can.

Cheers! 

[cobaltnv]

The FICO formula looks at both overall utilization and individual utilization. I would suggest option 2 splitting the $$ between the two cards. Ideally you would also have no other cards reporting a balance.

Cheers 

[RobertEG]

Yes, FICO looks at overall util and indiv card utilizations.  FairIsaac has stated in a recent webinar that both weigh about equally.  The worst thing you can do on individ card util is to be at or near max.  I would strive first to get all cards below 50%.

[Anonymous]

Thanks Guys!

[haulingthescoreup]

Several members (including me) have posted here that we have gotten away with high util on one card, but high util on two is a killer. This only works if you have a high enough total CL that the high balance on the one card doesn't appreciably change your overall util.

Like everything else FICO, though, this probably varies by individual credit profile, so as always, YMMV.

[marty56]

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@haulingthescoreup wrote:
Several members (including me) have posted here that we have gotten away with high util on one card, but high util on two is a killer.

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LOL, I tried do do that with low util, the result of it lead to my new sig.