topic Re: What is considered maxed out on a credit card? in Credit Cards

What is considered maxed out on a credit card?

Anonymous — Fri, 26 Jul 2013 18:21:34 GMT

I just want to know what is considered maxed out on a $4,500 limit. I have $198 left right now. My payments are $117. I've been running behind on money due to work but now that it is picking up I am able to finally put this credit card aside. I do have a co-signer and am worried that her credit score may have gone down due to the amount I have left. I have been making my payments on time usually a week before the due date because right when I get paid I make the payment. It's so low now because I end up having to spend that payment later on in the month on food and gas.

So is having that amount left considered maxed out? And if it is, will making larger payments like $200 instead of $117 increase the credit score faster?

Re: What is considered maxed out on a credit card?

Anonymous — Fri, 26 Jul 2013 18:29:48 GMT

Yes, you can consider that maxed out. If your limit is $4,500.. in order to keep your score and the co-signers score in the positive, you're going to want to keep the balance on that less than 30% of the limit.. so at any given time, you don't want to have $1,350 on the card, or scores will start going down.

I understand where you are though.. and as long as either of you aren't applying for credit, you'll both be fine. Just make sure you keep making payments on time, and then pay down what you can when you can!

Re: What is considered maxed out on a credit card?

myjourney — Fri, 26 Jul 2013 18:31:04 GMT

Yes to max'ed out thus a scoring ding will result

Re: What is considered maxed out on a credit card?

Anonymous — Fri, 26 Jul 2013 18:45:46 GMT

Anything above 90% utilization is considered maxed out. So to avoid that you should have at least $450 in available credit for that card.

It does affect both yours and your consigner scores. Paying more than just minimum will help lower utilization faster, and thereby help increase the scores back up faster.

Re: What is considered maxed out on a credit card?

Anonymous — Fri, 26 Jul 2013 18:54:19 GMT

Oh no, okay. Well when I got my credit card my co signer already knew I was going to have to spend almost all of it because it was for a big purchase. I've had it for two months so I haven't been able to pay a lot of it off right away. Making those minimum payments but having to spend it later for other things. It just stayed the same amount.

Re: What is considered maxed out on a credit card?

Anonymous — Fri, 26 Jul 2013 18:56:33 GMT

enharu ok I can make that $450 payment for the month of august so hopefully that will bump up the score quickly! Thank you!

Re: What is considered maxed out on a credit card?

Anonymous — Fri, 26 Jul 2013 19:02:17 GMT

OP, Anything above 70% of the credit limit looks like a mxed out credit cards. Your scores would rise once your utilization is below 30% and for best scores your util should be between 1-9%.

Re: What is considered maxed out on a credit card?

Adalen — Fri, 26 Jul 2013 20:03:20 GMT

While the under 30% is a general rule of thumb, getting your balance below 90% is usually a significant enough difference to get you started. Obviously OP is not in the position to pay it all down to 30% at this point in time, so 90% will be a nice step.

Don't just make the minimum payments. They will likely be eaten up by interest anyway (if you don't currently have a 0% interest rate).

Re: What is considered maxed out on a credit card?

Creditaddict — Fri, 26 Jul 2013 20:08:03 GMT

@Anonymous wrote:
OP, Anything above 70% of the credit limit looks like a mxed out credit cards. Your scores would rise once your utilization is below 30% and for best scores your util should be between 1-9%.

I was leaning more towards the 70-75% that Fico actually considers an account maxed and yes while others have posted 30,9, etc.... you will see score increases along the way as you pass each percentage that is considered... need to find that graph around here somewhere... If you can do $450 next month, then that's a great start... keep throwing what you can and it will start to help your score each month little by little... the account will also age more and depending on credit profile, maybe you could add another card... many things to get your score to continue to rise as you work on this 1 debt... hopefully it's the only maxed out card you have.

Re: What is considered maxed out on a credit card?

Anonymous — Fri, 26 Jul 2013 21:05:49 GMT

Glad to know I can quickly increase the score by increasing my payments I thought it would take months and months for the score to settle in and start increasing. I just put that credit card in my safe and locked it up! I have another credit card which is a Discover but I'm doing okay with that one. This is my only card that has a bigger limit on it with a co signer.

Re: What is considered maxed out on a credit card?

HiLine — Sat, 27 Jul 2013 00:17:20 GMT

The truth is, nobody knows. I doubt anyone has data on the impact of going from 95% to 90%.

Think about it. The closer you get to 100% the more nervous the lender will get. Look at the graph on this page: http://www.barclaycardring.com/t5/Barclaycard-Ring-Public-Blog/A-Case-Study-of-a-Credit-Line-Increase-and-Decrease-Part-II/ba-p/5840 . The likelihood of a credit limit decrease increases with rising utilization up to a certain point beyond which there is simple too little space left for the limit to be reduced by. On the other hand, reaching 100% is not the end of the world; with a Visa Signature you can charge over the limit without causing trouble.

If you honestly do not have the money the pay down the balance significantly I would maintain the current balance so that your bank will not award you with a credit limit decrease, while saving money to pay the balance later. Once you have accumulated $3k or so, pay it all at once to bring the risk down.

Re: What is considered maxed out on a credit card?

Anonymous — Sat, 15 Mar 2014 15:13:28 GMT

Just stopping to comment on your Target Card limit - you have awesome limits up to $15,000 in your signature line, but $200 on Target - it looks like they give everyone a hard time, I haven't been able to get them to raise my limit either

Re: What is considered maxed out on a credit card?

BrokaToe — Sat, 15 Mar 2014 15:59:42 GMT

Not sure if this really helps or not, but when speaking to the Chase Lending Department last night on the phone, the woman told me that when making a balance transfer they would only be able to move monies that equaled no more than 95% of the cards total available credit limit.

I know you're not looking for a balance transfer, but I thought maybe the 95% balance may be relevant. That may be a number that would prevent adverse action depending on the lender and of course how long one carried a balance that high. But as far as score increases I'm sure the other posters info is more accurate.

Re: What is considered maxed out on a credit card?

Kenny — Sat, 15 Mar 2014 17:15:41 GMT

@HiLine wrote:
The truth is, nobody knows. I doubt anyone has data on the impact of going from 95% to 90%.

Think about it. The closer you get to 100% the more nervous the lender will get. Look at the graph on this page: http://www.barclaycardring.com/t5/Barclaycard-Ring-Public-Blog/A-Case-Study-of-a-Credit-Line-Increase-and-Decrease-Part-II/ba-p/5840 . The likelihood of a credit limit decrease increases with rising utilization up to a certain point beyond which there is simple too little space left for the limit to be reduced by. On the other hand, reaching 100% is not the end of the world; with a Visa Signature you can charge over the limit without causing trouble.

If you honestly do not have the money the pay down the balance significantly I would maintain the current balance so that your bank will not award you with a credit limit decrease, while saving money to pay the balance later. Once you have accumulated $3k or so, pay it all at once to bring the risk down.

I would agree with you on this if the OP had multiple CLs all maxed out. I don't think the OP has to worry right now about adverse action from a lender too much. If they make their $450 payment they should be fine.

Re: What is considered maxed out on a credit card?

Kenny — Sat, 15 Mar 2014 17:16:53 GMT

Goodness gracious! This is from last year!

Can't believe I didn't see that before I posted.

Re: What is considered maxed out on a credit card?

sailor_mercury — Sat, 15 Mar 2014 17:18:28 GMT

@KennyS2006 wrote:
Goodness gracious! This is from last year!

Can't believe I didn't see that before I posted.

Yeah, I do that sometimes... I think we need a moldy oldie alert

Re: What is considered maxed out on a credit card?

BrokaToe — Sat, 15 Mar 2014 19:28:21 GMT

@sailor_mercury wrote:
@KennyS2006 wrote:
Goodness gracious! This is from last year!

Can't believe I didn't see that before I posted.
Yeah, I do that sometimes... I think we need a moldy oldie alert

Good gravy, now I feel like a doofus. It was showing at the top so I didn't even think about the possibility of it being an old revived thread.

Re: What is considered maxed out on a credit card?

indiolatino61 — Sat, 15 Mar 2014 19:29:53 GMT

@KennyS2006 wrote:
Goodness gracious! This is from last year!

Can't believe I didn't see that before I posted.

I do the same thing ALL THE TIME...lol!

Re: What is considered maxed out on a credit card?

avggoal700 — Sat, 28 Jun 2014 12:22:37 GMT

@Creditaddict wrote:
@Anonymous wrote:
OP, Anything above 70% of the credit limit looks like a mxed out credit cards. Your scores would rise once your utilization is below 30% and for best scores your util should be between 1-9%.

I was leaning more towards the 70-75% that Fico actually considers an account maxed and yes while others have posted 30,9, etc.... you will see score increases along the way as you pass each percentage that is considered... need to find that graph around here somewhere... If you can do $450 next month, then that's a great start... keep throwing what you can and it will start to help your score each month little by little... the account will also age more and depending on credit profile, maybe you could add another card... many things to get your score to continue to rise as you work on this 1 debt... hopefully it's the only maxed out card you have.

Old but was the graph posted somewhere