topic How does personal charge card affect FICO scores? in Understanding FICO® Scoring

How does personal charge card affect FICO scores?

SouthJamaica — Fri, 22 Apr 2016 22:40:39 GMT

I've had a business charge card for a couple of years, but no personal charge card, so I have no idea how a personal charge card with no fixed credit limit affects your FICO scores.

Can anyone give me some insight into that?

Re: How does personal charge card affect FICO scores?

RobertEG — Fri, 22 Apr 2016 23:52:35 GMT

Revolvng cards with no set credit limits are scored under % util by using the prior highest balance on the account as the denominator ("credit limit").

Re: How does personal charge card affect FICO scores?

SouthJamaica — Sat, 23 Apr 2016 01:48:42 GMT

@RobertEG wrote:
Revolvng cards with no set credit limits are scored under % util by using the prior highest balance on the account as the denominator ("credit limit").

Is the "prior highest balance" necessarily a reported balance, or might it be an intra-statement balance?

I.e., if I make a $10,000 expenditure, but pay it off before the statement cuts, will my credit report treat 10k as my limit and 0% as my utilization?

Or must I allow the 10k to report before it's counted?

Re: How does personal charge card affect FICO scores?

Revelate — Sat, 23 Apr 2016 02:13:48 GMT

@SouthJamaica wrote:
@RobertEG wrote:
Revolvng cards with no set credit limits are scored under % util by using the prior highest balance on the account as the denominator ("credit limit").
Is the "prior highest balance" necessarily a reported balance, or might it be an intra-statement balance?

I.e., if I make a $10,000 expenditure, but pay it off before the statement cuts, will my credit report treat 10k as my limit and 0% as my utilization?

Or must I allow the 10k to report before it's counted?

Like all credit cards that varies per lender.

Also under FICO 04 and later, any charge card (Amex is the typical example) with a Term of 1 month is excluded from the revolving utilization calculation (may still count number of cards w/balances) though we've had a pretty clear report that EQ 08 does indeed still factor them, but that might be due to the amounts falling north of some breakpoint.

Re: How does personal charge card affect FICO scores?

SouthJamaica — Sat, 23 Apr 2016 03:03:03 GMT

@Revelate wrote:
@SouthJamaica wrote:
@RobertEG wrote:
Revolvng cards with no set credit limits are scored under % util by using the prior highest balance on the account as the denominator ("credit limit").
Is the "prior highest balance" necessarily a reported balance, or might it be an intra-statement balance?

I.e., if I make a $10,000 expenditure, but pay it off before the statement cuts, will my credit report treat 10k as my limit and 0% as my utilization?

Or must I allow the 10k to report before it's counted?
Like all credit cards that varies per lender.

I haven't found a difference among credit card issuers. In each and every case on all cards I've had the statement balance is the reported balance, and the credit limit is the credit limit.

Also under FICO 04 and later, any charge card (Amex is the typical example)

Yeah I'm talking Amex

with a Term of 1 month is excluded from the revolving utilization calculation (may still count number of cards w/balances) though we've had a pretty clear report that EQ 08 does indeed still factor them, but that might be due to the amounts falling north of some breakpoint.

So it doesn't count for utilization, one way or the other, except with respect to FICO 8 EQ? And what does FICO 8 EQ say? Is the credit limit the high statement balance, or the high intrastatement balance?

Re: How does personal charge card affect FICO scores?

NRB525 — Sat, 23 Apr 2016 15:00:33 GMT

@SouthJamaica wrote:
@Revelate wrote:
@SouthJamaica wrote:
@RobertEG wrote:
Revolvng cards with no set credit limits are scored under % util by using the prior highest balance on the account as the denominator ("credit limit").
Is the "prior highest balance" necessarily a reported balance, or might it be an intra-statement balance?

I.e., if I make a $10,000 expenditure, but pay it off before the statement cuts, will my credit report treat 10k as my limit and 0% as my utilization?

Or must I allow the 10k to report before it's counted?
Like all credit cards that varies per lender.

I haven't found a difference among credit card issuers. In each and every case on all cards I've had the statement balance is the reported balance, and the credit limit is the credit limit.

US Bank reports all cards as of the end of the calendar month, without regard to statement date.

Chase will update your balance as zero if it goes to zero during the statement period, prior to statement issue.

Re: How does personal charge card affect FICO scores?

SouthJamaica — Sat, 23 Apr 2016 15:48:17 GMT

@NRB525 wrote:
@SouthJamaica wrote:
@Revelate wrote:
@SouthJamaica wrote:
@RobertEG wrote:
Revolvng cards with no set credit limits are scored under % util by using the prior highest balance on the account as the denominator ("credit limit").
Is the "prior highest balance" necessarily a reported balance, or might it be an intra-statement balance?

I.e., if I make a $10,000 expenditure, but pay it off before the statement cuts, will my credit report treat 10k as my limit and 0% as my utilization?

Or must I allow the 10k to report before it's counted?
Like all credit cards that varies per lender.

I haven't found a difference among credit card issuers. In each and every case on all cards I've had the statement balance is the reported balance, and the credit limit is the credit limit.

US Bank reports all cards as of the end of the calendar month, without regard to statement date.
Chase will update your balance as zero if it goes to zero during the statement period, prior to statement issue.

Thanks for that info; didn't know that. Obviously I have neither a Chase card nor a US Bank card

Re: How does personal charge card affect FICO scores?

Revelate — Sat, 23 Apr 2016 21:48:30 GMT

@SouthJamaica wrote:
@NRB525 wrote:
@SouthJamaica wrote:
@Revelate wrote:
@SouthJamaica wrote:
@RobertEG wrote:
Revolvng cards with no set credit limits are scored under % util by using the prior highest balance on the account as the denominator ("credit limit").
Is the "prior highest balance" necessarily a reported balance, or might it be an intra-statement balance?

I.e., if I make a $10,000 expenditure, but pay it off before the statement cuts, will my credit report treat 10k as my limit and 0% as my utilization?

Or must I allow the 10k to report before it's counted?
Like all credit cards that varies per lender.

I haven't found a difference among credit card issuers. In each and every case on all cards I've had the statement balance is the reported balance, and the credit limit is the credit limit.

US Bank reports all cards as of the end of the calendar month, without regard to statement date.
Chase will update your balance as zero if it goes to zero during the statement period, prior to statement issue.
Thanks for that info; didn't know that. Obviously I have neither a Chase card nor a US Bank card

The question you asked was whether high balance was the highest statement balance, or highest intra-statement balance. That varies by lender, my apologies if I was not clear.

Re: How does personal charge card affect FICO scores?

SouthJamaica — Sat, 23 Apr 2016 23:57:06 GMT

@Revelate wrote:
@SouthJamaica wrote:
@NRB525 wrote:
@SouthJamaica wrote:
@Revelate wrote:
@SouthJamaica wrote:
@RobertEG wrote:
Revolvng cards with no set credit limits are scored under % util by using the prior highest balance on the account as the denominator ("credit limit").
Is the "prior highest balance" necessarily a reported balance, or might it be an intra-statement balance?

I.e., if I make a $10,000 expenditure, but pay it off before the statement cuts, will my credit report treat 10k as my limit and 0% as my utilization?

Or must I allow the 10k to report before it's counted?
Like all credit cards that varies per lender.

I haven't found a difference among credit card issuers. In each and every case on all cards I've had the statement balance is the reported balance, and the credit limit is the credit limit.

US Bank reports all cards as of the end of the calendar month, without regard to statement date.
Chase will update your balance as zero if it goes to zero during the statement period, prior to statement issue.
Thanks for that info; didn't know that. Obviously I have neither a Chase card nor a US Bank card

The question you asked was whether high balance was the highest statement balance, or highest intra-statement balance. That varies by lender, my apologies if I was not clear.

The lender would be Amex

Re: How does personal charge card affect FICO scores?

CreditDunce — Sun, 24 Apr 2016 03:54:06 GMT

Amex reports your highest statement balance in the last X months/years as your highest balance. I don't remember how long the look back period is. In general, Amex doesn't report that much balance history information. While I do not have any inside information, I would guess they will eventually start reporting more balance information. The CRA's would like to use the information for future FICO/VS models.

I remember a thread with fairly strong evidence showing EQ may handle charge cards differently than the other CRA's. However, it was only one data point. I don't remember if the poster had POT enabled on the account or not. Personally, I wouldn't it. If the Charge card makes sense financially for you, get it. Test it to see how it affects your FICO scores with different balances. Worst case scenario, just make the charge card a zero balance card when it is time to maximize your FICO score.

Re: How does personal charge card affect FICO scores?

SouthJamaica — Sun, 24 Apr 2016 13:43:05 GMT

So is it accurate to say:

1. FICO8 EX & TU ignore Amex charge cards for utilization purposes

2. FICO8 EQ factors it in, and treats highest reported statement balance during certain window of time as though it were a credit limit

Re: How does personal charge card affect FICO scores?

Revelate — Sun, 24 Apr 2016 14:07:20 GMT

@SouthJamaica wrote:
So is it accurate to say:

1. FICO8 EX & TU ignore Amex charge cards for utilization purposes

2. FICO8 EQ factors it in, and treats highest reported statement balance during certain window of time as though it were a credit limit

1) Yes

2) Close enough for government work; numbers north of ~35K are handled wierdly in FICO land and it may have been falling afoul of that instead of being counted as revolving utilization.

I personally never saw any movement based on my Zync's balance but I wasn't looking for it to be fair and didn't have solid FICO 8 access at that point so could've been missed.

Re: How does personal charge card affect FICO scores?

SouthJamaica — Sun, 24 Apr 2016 14:25:59 GMT

@Revelate wrote:
@SouthJamaica wrote:
So is it accurate to say:

1. FICO8 EX & TU ignore Amex charge cards for utilization purposes

2. FICO8 EQ factors it in, and treats highest reported statement balance during certain window of time as though it were a credit limit

1) Yes

2) Close enough for government work; numbers north of ~35K are handled wierdly in FICO land and it may have been falling afoul of that instead of being counted as revolving utilization.

I personally never saw any movement based on my Zync's balance but I wasn't looking for it to be fair and didn't have solid FICO 8 access at that point so could've been missed.

Can your answer to Number 2 be translated to "more or less"?

Re: How does personal charge card affect FICO scores?

Revelate — Sun, 24 Apr 2016 16:37:50 GMT

Pretty much

Re: How does personal charge card affect FICO scores?

SouthJamaica — Mon, 25 Apr 2016 00:10:57 GMT

@Revelate wrote:
Pretty much

Thanks