10-11-2013 06:30 PM - edited 10-11-2013 08:54 PM
I've been working on rebuilding my credit after emerging from a BK 2 years ago and have some questions. I'll be the first to admit that I haven't done everything properly and have made some mistakes. I have far too many inquiries and have settled for too many low-limit credit cards...but I also didn't understand that bigger banks won't give you a thought w/a BK on your credit. But, through a lot of hard work, I've been able to get my FICO score up to 641 from a low of 509....though it took a lot of talking with creditors, taking care of money I owed for health bills, and ultimately getting negative items deleted from my reports.
But, that's not why I'm here. I have questions about credit utilization and how it's calculated. I have some confusion regarding whether FICO calculates scores based on overall credit utilization or individual credit lines. I have 1 credit card that is, admittedly, too high and my overall utilization right now is at 41% (that one card is much higher and a secured card no less). I know I can easily drop that number down significantly, however I'm trying to determine if it's better to pay down the 1 credit card that is too high, or pay down my other cards that are at about 20% at the moment? I can provide more info if necessary.
Thanks for the help, love this forum.
10-12-2013 07:56 PM
FICO weighs both individual and overall util. While overall util is weighed more, you can certainly see significant dings if you have any cards maxed out or if most of your accounts are reporting a balance other than $0. For best results, pay all CCs to $0 except for one and get one to report a balance of under 9% of the CL.