topic Re: Confused in Understanding FICO® Scoring

Confused

Anonymous — Wed, 08 Nov 2017 15:33:21 GMT

Hello, question: do I have to show a balance for both total utilization and single card utilization or just utilization on a single card? My understanding is I do have to show a balance on both but because of recent credit increases I'm currently showing zero percent credit used even with a small balance on a card.

So to see if I have this correct please check my new math. If my new total credit is 21k I need at least $210 to show 1% overall utilization. In addition if the card I want to show the balance on is at 3.5k then I'm also doing good because its under 30% or $1,050.

I feel like showing zero is holding my scores down a little even though I currently have a small balance. Please advise.

Re: Confused

Anonymous — Wed, 08 Nov 2017 16:11:29 GMT

FICO rounds up small numbers to 1%, usually.

So just reporting $40 on a single credit card (as long as the credit limit is more than $500) is perfect each month for maximum FICO scoring benefit per the AZEO Method (all zero except one).

If you report just $5 on a $10,000 credit limit, FICO considers it 1%.

Screen shot from my 1B Experian today, $79 reported on a $2500 limit, $14,400 total credit, shows as 1%.

I should mention that even if I only report $5, it still says 1%.

Re: Confused

Anonymous — Wed, 08 Nov 2017 16:37:45 GMT

See that's what I thought and why I'm confused.
$53.00 and 0%

Re: Confused

Anonymous — Wed, 08 Nov 2017 16:44:07 GMT

Monitoring software will often round things down, but monitoring software is not what FICO uses. Any positive reported balance will round up to 1% for FICO scoring purposes, so you can completely ignore any piece of monitoring software fluff that happens to round down.

Re: Confused

Anonymous — Wed, 08 Nov 2017 16:50:46 GMT

Thank you, that would make sense but S/he is using the same software and seeing different results? I do understand that the actual situation could be contrasting what is represented by their chart and i'll be vigilant when MyFico is up in December to check out that in detail by comparison.

Re: Confused

Anonymous — Wed, 08 Nov 2017 16:57:09 GMT

@Anonymous wrote:
Thank you, that would make sense but S/he is using the same software and seeing different results? I do understand that the actual situation could be contrasting what is represented by their chart and i'll be vigilant when MyFico is up in December to check out that in detail by comparison.

They are seeing the same results. Your actual aggregate utilization is around a quarter of a percent, so the monitoring software is rounding that down to 0%. The other person is just over a half percent, so it is rounding that up. It would appear that the monitoring software in question here rounds anything that .49999 or less down to 0 and likely rounds anything that's .50 or greater up to 1.

Either way, rounded up or rounded down by monitoring software, FICO will treat it as positive (1%) utilization.

Re: Confused

Anonymous — Wed, 08 Nov 2017 16:59:13 GMT

Ah hah! Love this community. Thank you again!

Re: Confused

SouthJamaica — Wed, 08 Nov 2017 18:56:05 GMT

@Anonymous wrote:
Hello, question: do I have to show a balance for both total utilization and single card utilization or just utilization on a single card? My understanding is I do have to show a balance on both but because of recent credit increases I'm currently showing zero percent credit used even with a small balance on a card.

So to see if I have this correct please check my new math. If my new total credit is 21k I need at least $210 to show 1% overall utilization. In addition if the card I want to show the balance on is at 3.5k then I'm also doing good because its under 30% or $1,050.

I feel like showing zero is holding my scores down a little even though I currently have a small balance. Please advise.

For optimal scoring you only need one card to report a small balance. On the other accounts, the more reporting zero, the better.