topic Re: Utilization question in Understanding FICO® Scoring

Utilization question

WallyxD — Tue, 09 Jul 2013 16:08:31 GMT

Okay, so my util is around 60% and my scores dropped anywhere from 10-25 points. My question is, does your score only go up or down as long as the util is reduced or increases? Because say if next month my util is still 60%, give or take a couple, will my score still have as huge a drop as it did when I went from about 20% to 60% util? Or does the score improve as util is reduced regardless of how small the change is? I hope I'm being clear.

Re: Utilization question

Quips — Tue, 09 Jul 2013 16:29:58 GMT

@WallyxD wrote:
Okay, so my util is around 60% and my scores dropped anywhere from 10-25 points. My question is, does your score only go up or down as long as the util is reduced or increases? Because say if next month my util is still 60%, give or take a couple, will my score still have as huge a drop as it did when I went from about 20% to 60% util? Or does the score improve as util is reduced regardless of how small the change is? I hope I'm being clear.

In my experience there are certain Util levels that move your score - I have found that those levels for total util are <50%, then <30%, then <10% - at each of these levels I have gotten an uptick in my score (or downtick - depending on which way you are going). Additionally there are a couple other factors that will impact your FICO score - 1) Having an indivual card at a high Util (over 50%) or having one at the "maxed out" level (90%+) and 2) having a balance report on more than 50% of your active trade lines - both of those have impacted my score.
You score will go up or down when you cross certain thresholds - if your Util stays at or near the same (60%) in your case, your score should not change because of Util (it could move for some other reason - inquires, new account, baddie reporting, too many cards with balances etc)

Hope this helps

Re: Utilization question

Anonymous — Tue, 09 Jul 2013 16:32:34 GMT

@WallyxD wrote:
Okay, so my util is around 60% and my scores dropped anywhere from 10-25 points. My question is, does your score only go up or down as long as the util is reduced or increases? Because say if next month my util is still 60%, give or take a couple, will my score still have as huge a drop as it did when I went from about 20% to 60% util? Or does the score improve as util is reduced regardless of how small the change is? I hope I'm being clear.

Score doesn't consider the history of utilization, so if your util stays at 60%, your score will be similar to this month's score (of course, the accounts and inqs are aging, so there may be some change). Reducing utilization in general will improve your score, but once it is low enough reducing it more won't help (and if it gets to 0, you may see a slight drop). And reducing it very slightly might not having any impact, but in general, lowering util increases score.

Re: Utilization question

WallyxD — Tue, 09 Jul 2013 17:06:03 GMT

Thanks a lot. I started to freak out a bit because I figured that if my scores dropped which I just found out to be 30-40 points within the past couple of months, that I'd experience the same thing every month. Thanks again.

Re: Utilization question

Anonymous — Tue, 09 Jul 2013 17:09:57 GMT

My Utilization effects my score in a big way---I can lose almost 60 points if I come close to maxing a card out. I try to keep all my cards below 35% Utilization

Thanks Brigitte Grisanti