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types of debts in credit utilization pct

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Anonymous
Not applicable

types of debts in credit utilization pct

What debts are included in calculating a credit utilization score? I have:

credit cards

auto loan

student loan

home depot project loan

 

Message 1 of 6
5 REPLIES 5
Anonymous
Not applicable

Re: types of debts in credit utilization pct

A credit score is a number (typically between 300 and 850) that is supposed to represent the likelihood that you will run into trouble (late payments, etc.) in the next year or two.  The higher the number is, the less likely you'll get into trouble.

 

That number is generated by looking at all of the data in your credit report.  Each of the three big credit bureaus collects all kinds of information on you, typically loans and credit cards, and your report is a summary of all that bureau's data.

 

So the answer to your question (what accounts affect my score?) is: everything on your report.  But not all creditors will report each account to each bureau.  So what you need to do is find out which of those accounts are on which reports.  And you will do that by pulling your credit reports at each bureau.

 

You may very well find that all of the accounts you mention appear on all three reports.  But you may not.


The accounts that will not appear are checking and savings accounts.  Those appear on the reports generated by two other bureaus: ChexSystems and EWS.  FICO scores are not generated off of those two reports.

Message 2 of 6
SouthJamaica
Mega Contributor

Re: types of debts in credit utilization pct


@Anonymous wrote:

What debts are included in calculating a credit utilization score? I have:

credit cards

auto loan

student loan

home depot project loan

 


There are 2 main types of utilization factored into your FICO scores:

 

-revolving utilization (usually credit cards but also includes personal lines of credit)

 

-installment loan utilization (your auto & student loans would definitely fit in this category; it sounds like the home depot project loan would too)


Total revolving limits 741200 (620700 reporting) FICO 8: EQ 701 TU 704 EX 685

Message 3 of 6
RobertEG
Legendary Contributor

Re: types of debts in credit utilization pct

Utilization is a broad category that includes utilization of both revolving and installment credit.

In broad terms, the revolving component of the category is weighted at much higher level than util of your installment credit.

 

Percent utilization relates ONLY to scoring of revolving accounts, such as credit cards and lines of credit.  It is the percentage of current balance to the credit limit.

Each individual revolving account is scored on its individual % util, and the sum of the balances and credit limits on all revolving accounts is used to score your overall % util.

 

Installment loans of all types are scored using the % current balance of orig loan amount, and is much less significant than % util scoring.

 

Message 4 of 6
Anonymous
Not applicable

Re: types of debts in credit utilization pct

Thanks for the responses. My goals are 1) debt reduction and 2) score improvement but I've reached a point where the remaining revolving debts have similar interest rates to the other debts and I am wondering if it makes sense in terms of score improvement if I should pay down the revolving debts first, or even shifting debt from revolving to installment? I pulled my credit report and confirmed that the Home Depot debt is classified as revolving and the PayPal credit doesn't show up on my reports (I pulled TransUnion and Equifax).

 

Message 5 of 6
Revelate
Moderator Emeritus

Re: types of debts in credit utilization pct

Revolving is a much larger percentage of the FICO 8 scorecard than installment.

 

Either paying it down first, or even converting it to installment can be a non-trivial FICO win though personally if it doesn't take that long to pay it down or off I wouldn't bother refinancing it to a similar APR loan.




        
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