Lese detrimental to fico score

[Anonymous]

Greetings; I only post here rarely but I need help at this time in deciding which one of these two options that I have would have the lese detrimental effect on my fico score. I have one Credit Card with a $6,000 credit limit on it with a $1,000 balance on it at this time and I have a new Credit Card that I have never used that has a $5,000 Credit Limit. I need $5,000 at this time and I was wondering if I should max one of them out to get the $5,000 that I need and if so which one, the long established one with the $6,000 limit and $1,000 balance or the new one with the $5,000 limit. Or should I put 50% ($2,500) on each one for the total of $5,000. Both Cards have the same interest rate.  Thank you very much for your responses

[marty56]

Welcome to the forum.  Protect your older card and use the new one.

[RobertEG]

My opinion, simply from a FICO scoring perspective.

Under the FICO category of util of credit, approx half is scored based on overall % util, with the other half being the combined affect of indiv card utils.

This comes from a statement made by Fair Isaac in one of their past webinars.

So with two cards, approx 50% of the impact woould look at overall % util, and each of the utils on the indiv cards would contribute approx. 25% each.

You currently have an overalll CL of $11,000 and a current balance of $1,000.  That is a 9% overall util

Addiing an additional blance or $5,000 will then put you at around 55% overall util, regardless of which card you charge it to. So that is the major FICO impact.

Which card to put the new balance on then depends, in my opinion,  on whether the FICO algorithm for scoring individual cards is a purely linear impact on score, or whether it penalizes higher % utils more than low.  My experience is the latter. 

If you assume that, then putting the entire  $5K all on one card or the other would max out that card at 100% util.  I think this would have more of a FICO impact than splitting the new balance to, say, $2.500 on each card, thus keeping both below 60%.