How does CC utilization affect your FICO? (account by account, or total balances vs total available)

Anonymous — Sat, 10 May 2008 19:27:02 GMT

I know that utilization of credit is important for the fico score. How do they compute it?

In the formula, is it the total amount of credit relative to the total balances you have?

Or does each account have its own weight - in other words, if I have one card with 90% utilization and 5 cards with 5% each, is that worse than distributing that one high balance?

Thanks1

Re: How does CC utilization affect your FICO?

Anonymous — Sat, 10 May 2008 21:00:53 GMT

Debt to total credit available.

ie, 5 cards with $1,000 CL = $5,000 total credit.
1 card has a bal of $1,000 and all others are at $0.

Total revolving debt is $1,000 to ratio total CL of $5,000 = 20% UTL.

HOWEVER. Yes each card does hold some individual weight too. Because you have 1 maxed out card in this example that will cost you more points too where as if you had 2 cards with $500 each your score should be slightly higher. You will also get hit for too many cards with balances so if you had $200 on each card totaling up $1,000 your UTL would still be 20% but your score would be even lower because you had all your cards with balances at the same time. Sorta complicated.

Best to have less than half showing balances
Best to have very low UTL
Best to not exceed 89% of the limit on any single card.

topic How does CC utilization affect your FICO? (account by account, or total balances vs total available) in Understanding FICO® Scoring

How does CC utilization affect your FICO? (account by account, or total balances vs total available)

Re: How does CC utilization affect your FICO?