Hi all--I was wondering if any of you guys could share any experiences you have had when paying down credit cards and how it affects scores. I am waiting for my credit reports to update my new utilization. It is going from 59% to 38%. What kind of increase should I expect on that alone? I am working with a mortgage company and the LO told me that to get a better rate my mid score should be 640 and I am 3 points away (EQ).
I'd guess 5-15 with more points reappearing on EQ vs TU. I would also guess a 20-30 increase if it dropped below 30%. All of this is assuming that the util is correct, that there aren't other accounts factored into util like CC COs, is assuming you have a good mix of credit (e.g. 3 or more CCs), and is assuming that util is listed as one of the top negative scoring reasons.
IME, I paid down util from 89% to 1% in one month and saw a 125 increase on EQ and 75ish on TU. I pulled my FICOs frequently during that time period and tracked the changes. I found most of my bumps came in when it hit below 30% and when more CCs hit a zero balance.
Thanks, llecs!!Utilization is listed as one of the top negative reasons. I sure hope that I do get between 10-15 points. I will post my new score as soon as the account reports the zero balance and the CLI of $400.
Decreasing revolving util is one of the fastest and easiest way to give your score a boost. Most have found that having one CC report with a util of 9% and under has given max results.
UPDATE: Received notification today from Equifax that my score had changed. It went up 10 points by decreasing utilization from 59% to 39%. I am happy. I needed to be over 640 and this did it. Thanks for all the replies.