New Contributor
AQ
Posts: 83
Registered: ‎02-28-2013
High Balance vs Utilization and impact on scoring

I was considering using my newer credit card for a bigger purchase than I would usually make since I have 6 months interest free.  In the past, I haven't gone over 15 or 20% on this card, and have been under 10% on all other cards.  Here's my inquiry:

 

I understand that utilizing 30% or more hurts the score and that it's best to keep it much lower than that.  I also understand this rule of thumb to relate to the monthly balance and that, once the balance is paid down to zero, that previous utilization isn't impacting the score.  But since the credit reports note the highest balance carried on a card at any point, how does this affect the score?  For instance, if I used, say, 60% of my cl on one cc and paid off the balance soon, would that 60%  high balance continue to hurt my score even after the balance is paid down?  I understand this might be the case if I maxed it out, using something closer to 90%, but I don't wish to go that high. 

 

So how does the scoring work for cc limits?  Am I long-term dinged for going over 30%, or does that ding only affect me until I pay off the balance? 

 

Thanks!



Starting Score: TU 641 2/28/13 EQ 640 3/1/13
Current Score: TU663 EQ661
Goal Score: 750 750