HELOC - Revolving or Installment

[Anonymous]

I just got a HELOC at my local credit union.   Will FICO consider this revolving or installment when calculating my utilization?

[haulingthescoreup]

What's the credit limit on it? HELOC's at $50K+ (maybe $40K+) are treated for util as installment. This is the credit limit, not the balance.

HELOC's with lower credit limits --$20 - $30K --are sometimes treated as revolving, which can kill scores once you get that balance up. MidnightVoice's HELOC is treated as installment by EQ and TU (I think), but EX treats it as revolving, so his EX score drags behind the others. (I hope I'm summarizing his plight correctly.)

For those of us who are actually using a HELOC for home improvement, that can be pretty annoying!

[Anonymous]

This is only for $7,500.

[MidnightVoice]

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haulingthescoreup wrote:

. MidnightVoice's HELOC is treated as installment by EQ and TU (I think), but EX treats it as revolving, so his EX score drags behind the others. (I hope I'm summarizing his plight correctly.)

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Correct - although TU and EQ actually have it under "Real Estate Accounts" and not under "Installment Accounts".  Same effect though

[Anonymous]

So Hauling,

HELOC's with a CREDIT LIMIT >$50k is treated as installment?    Has this been confirmed?  For example, if I have a HELOC with a $80k credit limit but a $30k balance is DEFINITELY treated as an installment loan?

This is news to me (thought it depended on the o/s balance), good news to be sure, but I want to confirm.

[haulingthescoreup]

Yep. Mine is $50K, and now that the balance is on up there, I can confirm this. Even EX, which isn't very informative, hit me once for "high" util (when it was 8%), but the comment went away the next month, even though the HELOC balance went up.

Unless you've got a really high CC total CL, you would see balances on your HELOC swinging your reported util, if it were being included in it. (That was not a very clear sentence; hope it made sense, sort of.)

[Anonymous]

I confirmed that not only is it not counted in UTL-

I don't think if factors into scoring AT ALL - except avg age and obviously if you were late.

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Boscoe wrote:

So Hauling,

HELOC's with a CREDIT LIMIT >$50k is treated as installment?    Has this been confirmed?  For example, if I have a HELOC with a $80k credit limit but a $30k balance is DEFINITELY treated as an installment loan?

This is news to me (thought it depended on the o/s balance), good news to be sure, but I want to confirm.

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Message Edited by Timothy on 07-23-2008 09:34 PM

[Lel]

My experience also supports the >$50k-treated-as-installment hypothesis. I just got a $98k HELOC that I maxed out on a mortgage refi. If it were treated as revolving, then my utilization would have gone to over 60% and my score would have tanked. My score went down by only 7 points, and I'm sure that most of those points are due to the fact that I have a brand-new account.

And yes, it is the credit limit, not the balance, that determines whether a HELOC is treated as revolving or not.

[Anonymous]

Mine reports as installment on all 3 cr,it is over 50k