topic Re: Will utilization report 0% with a small balance? in Understanding FICO® Scoring

Will utilization report 0% with a small balance?

masscredit — Sun, 03 May 2015 20:10:42 GMT

I'm going to be changing which card reports a balance next month. Last year I accidentally paid off all my cards and lost 13 points. I'd like to avoid that. If I let $100.00 report, that will be a utilization of .002%. What will report? Will it be at 0% or round up to 1%?

(Correcting the above. Guess I can't do math at 12:30am. That would be .26%.)

Re: Will utilization report 0% with a small balance?

MarineVietVet — Sun, 03 May 2015 04:31:11 GMT

@masscredit wrote:
I'm going to be changing which card reports a balance next month. Last year I accidentally paid off all my cards and lost 13 points. I'd like to avoid that. If I let $100.00 report, that will be a utilization of .002%. What will report? Will it be at 0% or round up to 1%?

Utilization always rounds up.

Re: Will utilization report 0% with a small balance?

NRB525 — Sun, 03 May 2015 14:44:45 GMT

@masscredit wrote:
I'm going to be changing which card reports a balance next month. Last year I accidentally paid off all my cards and lost 13 points. I'd like to avoid that. If I let $100.00 report, that will be a utilization of .002%. What will report? Will it be at 0% or round up to 1%?

seriously? $100? That's it?

What is the spend flow through your cards in a month?

Re: Will utilization report 0% with a small balance?

masscredit — Sun, 03 May 2015 16:16:44 GMT

Depends on the month. Could be about $1000. or it could be a few thousand. I usually use them for monthly expenses that can be paid for with a credit card. I've set up the account closing dates so they are spread out throughout the month. Only one card reports most months. For my main cards, the Cap 1 cards close at the beginning of the month and the Barclay cards close in the middle. I usually let one of my Barclay cards report a balance. I'm shifting that over to one of the Cap 1 next month so I want to plan the switch ahead of time. I'll leave $100.00 reporting on the Barclay card when it closes in a few weeks then start to have the Cap 1 card report a balance the beginning of next month. I'll pay the Barclay card off after that. I try not to let anymore than the month's expenses report.

Re: Will utilization report 0% with a small balance?

NRB525 — Sun, 03 May 2015 16:25:39 GMT

Your scores in the high-600's seem to indicate you are coming back from some set of late payments? If so, then the score gains from those aging, and adding new months of positive payments are going to outweigh any "all cards at zero but one" games.

You realize if you let the $1,000 of monthly charges report that would still only be 2.6% utilization, right? And from other comments around here, I'm not sure you are going to avoid having that $1,000 spend flow be counted in your utilization somehow.

Re: Will utilization report 0% with a small balance?

masscredit — Sun, 03 May 2015 16:43:57 GMT

I had a BK in 2009 and 5 tax liens (2 paid off). No late payments since the BK. I've been full speed ahead at rebuilding since the Summer of 2012. I think I've done all that I can to maximize my scores. The IIB accounts started to fall off a few months ago so I've been gaining some points from them. I have a few more that will fall off over the next 6-8 months. I think the only thing that I have left to control is utilization so I try to keep that low. Actually, I've been playing with it a little to see if there is a sweet spot that will give me a few extra points. Usually, the one card that reports a balance shows about $800. - $1000.

One thing that I've been trying to determine is when we keep one card reporting < 10%, is that number < 10% of the one card's credit line or the total of all credit lines combined? I've been basing it on the one card's credit line.

To do the card switch and avoid having the higher spend flow showing in my utilization, I just plan which cards that I'm going to use based on the statement closing dates and make sure those statements close at zero most of the time. It's been working great.

Re: Will utilization report 0% with a small balance?

NRB525 — Sun, 03 May 2015 17:08:32 GMT

@masscredit wrote:
I had a BK in 2009 and 5 tax liens (2 paid off). No late payments since the BK. I've been full speed ahead at rebuilding since the Summer of 2012. I think I've done all that I can to maximize my scores. The IIB accounts started to fall off a few months ago so I've been gaining some points from them. I have a few more that will fall off over the next 6-8 months. I think the only thing that I have left to control is utilization so I try to keep that low. Actually, I've been playing with it a little to see if there is a sweet spot that will give me a few extra points. Usually, the one card that reports a balance shows about $800. - $1000.

One thing that I've been trying to determine is when we keep one card reporting < 10%, is that number < 10% of the one card's credit line or the total of all credit lines combined? I've been basing it on the one card's credit line.

To do the card switch and avoid having the higher spend flow showing in my utilization, I just plan which cards that I'm going to use based on the statement closing dates and make sure those statements close at zero most of the time. It's been working great.

Well, the only thing I have left to control is utilization, which is why I'm paying down balances from massive levels to a low roar.

In your case, if it keeps you busy and makes you happy to get the cards to zero, go for it. I just don't think you are going to be able to point to that, in the river flow of your FICO scores, the little drops of water you may be generating by managing the cards to zero, versus the torrent of points gained by the baddies expiring.

Re: Will utilization report 0% with a small balance?

masscredit — Sun, 03 May 2015 17:42:33 GMT

Based on the info that I've posted, do you have any suggestions that I can use to improve my scores? Maybe something I'm missing?

Re: Will utilization report 0% with a small balance?

NRB525 — Sun, 03 May 2015 18:15:42 GMT

FICO is a long term scoring algorithm. The only two things you can do now are wait, and never miss a payment. The third, not apping, is temporary until you get to a point where cards with better benefits are in reach.

You have the utilization under control. All you have to do now is not miss any payments. It kind of goes unspoken around here, but that "never miss a payment" theme is helping a lot of people, even though they think managing their cards to zero is the real deal. By managing their cards to zero, they never miss a payment. It still counts as a win, even if they get the underlying causality wrong.

Re: Will utilization report 0% with a small balance?

masscredit — Sun, 03 May 2015 19:05:59 GMT

Pretty much everything that I have been doing. I have a list of the remaining IIB accounts and when they should fall off. I was able to have some of the accounts on TU deleted early. The accounts on EQ and EX are starting to age off. AAoA is growing, I don't want any new apps. Would like to see inquiries at zero across the board. And never want another late payment. I remember where I was 3-4 years ago and appreciate where I am now.

Thank you for your input!

Re: Will utilization report 0% with a small balance?

Anonymous — Sun, 03 May 2015 19:23:52 GMT

MassCredit... quick question. You said in your original post that a $100 balance for you would be .002% utilization. Are you sure that's right? That would mean that your combined revolving credit limit is 5 million dollars.

Re: Will utilization report 0% with a small balance?

masscredit — Sun, 03 May 2015 20:13:26 GMT

I had to look at that again to get it. Your right $100.00 of a total credit line of $38,700 is .26%.

I wish I had a revolving credit limit of $5 million