topic Re: Credit Card Utilization Question in Credit Cards

Credit Card Utilization Question

littlepriest01 — Tue, 16 Apr 2013 18:04:26 GMT

Hello All,

I'm currently pulling a 612 fico. I can get financing for a home at 620. I have 10k in credit card debt, with 4k in the bank to pay on it. I'm currently at 91% utilization.

I just paid off with my tax return one card in full, it went from 94% utilization to 0 obviously. It brought my overall utilization down from 92.036% to 68.533%, with my other payments, I should bring it down to 42.739%.

The simulator has me getting bumped up to the range 632-672. Do you think that I will actually end up over the 620 hump?

Also, all of my CC accounts (Wells Fargo Visa, AMEX, Barclay, GEMoney) will update after the statement is run? They all end next week, so I'm wondering if my score will be greatly improved in two weeks time.

Thanks for any help

Re: Credit Card Utilization Question

dodfire — Tue, 16 Apr 2013 18:09:25 GMT

Everyone is different..its really hard to predict how many points someone will gain. But, utilization is the fastest way to get a bump in score.

Going from 94% down to 42% should merit you a pretty good bump.

Also if you only have a balance on ONE card you will see a better score.

Re: Credit Card Utilization Question

Anonymous — Tue, 16 Apr 2013 18:09:50 GMT

how long is your credit history?

do you have any negatives on file (late payment, collections, etc)?

if your utilization is the only thing dragging you down, you should see quite a big jump in your scores. For my case 95% util to 0% util was almost a 100 point jump.

Re: Credit Card Utilization Question

littlepriest01 — Tue, 16 Apr 2013 18:13:46 GMT

17 years of credit history. I have three late payments (30 days) in 2009 when I was jobless.

Other than that, I have an older collection for medical (30$). I am trying to get all of this taken away with goodwill adjustments but I don't know how long that typically takes.

I've found a lender that would give a good rate at 620, so I'm hoping paying down my overall utilization by 50% would at least give me eight points.

Re: Credit Card Utilization Question

09Lexie — Tue, 16 Apr 2013 18:14:04 GMT

How soon are you thinking about purchasing a home? I assume that you are aware of the qual for loan approval would require a much lower dti ( in most cases).

Re: Credit Card Utilization Question

Anonymous — Tue, 16 Apr 2013 18:18:46 GMT

@littlepriest01 wrote:
17 years of credit history. I have three late payments (30 days) in 2009 when I was jobless.

Other than that, I have an older collection for medical (30$). I am trying to get all of this taken away with goodwill adjustments but I don't know how long that typically takes.

I've found a lender that would give a good rate at 620, so I'm hoping paying down my overall utilization by 50% would at least give me eight points.

have u talked to a loan officer yet?
like lexie said, each company has a minimum debt to income ratio you have to meet, so you might have to pay your utilization down to below 50% to qualify for your mortage.

if you can pay your utilization down to approx 30-50%, i think you should be above 620 at the very least. you can try using some of those simulators to estimate. they're not very accurate but at least you kinda know if you should pay it down more or if it's going to be okay. Can keep experimenting with it since you got 2 more months to get a loan?

Re: Credit Card Utilization Question

littlepriest01 — Tue, 16 Apr 2013 18:31:01 GMT

My current debt to income ratio (with the new house and without paying anything down on the cc's) is 27.9 percent. (I'm including CC minimums, mortgage (inclusive of real estate taxes and home owners insurance), and student loans and car payments).

Re: Credit Card Utilization Question

09Lexie — Tue, 16 Apr 2013 18:38:23 GMT

Paying down your util should give you the score bump you need. Good luck and sd those cc's until after your mortgage closes!

Re: Credit Card Utilization Question

Anonymous — Tue, 16 Apr 2013 18:38:56 GMT

@09Lexie wrote:
Paying down your util should give you the score bump you need. Good luck and sd those cc's until after your mortgage closes!

+1!

Re: Credit Card Utilization Question

littlepriest01 — Tue, 16 Apr 2013 18:39:56 GMT

Does SD mean slow down? I'm new to the forums and don't know all of your fico lingo

Re: Credit Card Utilization Question

dodfire — Tue, 16 Apr 2013 18:41:05 GMT

@littlepriest01 wrote:
Does SD mean slow down? I'm new to the forums and don't know all of your fico lingo

SD = Sock Drawer = Dont use them!!

And good luck on your score bump!!

Re: Credit Card Utilization Question

09Lexie — Tue, 16 Apr 2013 18:43:59 GMT

Thanks dodfire !

Op, By the way... Welcome to the forum!

Re: Credit Card Utilization Question

littlepriest01 — Tue, 16 Apr 2013 19:19:49 GMT

One more question, how long after each credit card statement is printed does it take for them to report to the agency?

Re: Credit Card Utilization Question

Anonymous — Tue, 16 Apr 2013 19:21:13 GMT

About a week at most. Transunion is usually the slowest

Re: Credit Card Utilization Question

Anonymous — Tue, 16 Apr 2013 23:32:39 GMT

Sock Drawer

Re: Credit Card Utilization Question

littlepriest01 — Wed, 17 Apr 2013 15:44:10 GMT

Last night one of the three credit agencies (Experian) updated to include the new balance. It improved my FAKO Score from USAA from 605 to 631, with only one of my credit cards paid down. I'm paying 1.5x what I just did over again, so I'm hoping that I will see a significant overall bump.

I'll be pulling myFico again once I see it reported at all three agencies.

Thanks all

Re: Credit Card Utilization Question

dodfire — Wed, 17 Apr 2013 15:46:12 GMT

Thats great news....Congrats!!

Re: Credit Card Utilization Question

webhopper — Wed, 17 Apr 2013 16:40:33 GMT

Hello and Welcome to MyFICO community forums!

Congrats on the score bump!

Most folks seem to get max FICO points by gearing their cc paying habits to their statement dates and/or account reporting dates (usually one and the same, but different in a few cases such as AmEx, US Bank and 1 or 2 others) to control the reported balances on their CR's and therefore their utiliization (debt-to-available credit ratio), since low util makes for happy FICO scores.

Most CCCs report your account balance as of your statement date, and most do the actual reporting to the credit bureaus ON your statement date as well (again - a few exceptions).

So, in general, the trick is to either PIF before your statement/reporting date every month or to pay down to a tiny percentage of your overall credit limit (all zero balances can actually hurt your scores, so it pays to let at least one report a balance, unless you only have 1 or 2 cc's), let that tiny percentage report, then PIF once your statement cuts to avoid paying any interest.

FICO scores love to see what appear to be minimally-used credit cards!

Re: Credit Card Utilization Question

littlepriest01 — Wed, 17 Apr 2013 17:13:48 GMT

If AMEX doesn't report on statement date, when do they?