topic Re: AMEX PRG (NPSL) balance reflecting in overall utilization of revolvers? in General Credit Topics

AMEX PRG (NPSL) balance reflecting in overall utilization of revolvers?

Anonymous — Fri, 24 Jul 2020 16:43:03 GMT

The MyFico score/reports are showing the balance of my AMEX w/ NPSL reflecting in my overall credit balances without increasing my PL and thus scewing my raw utilization.

Every bureau says that "things affecting your credit" is "high utilization"

My real utilization on Revolvers is ~30% w/ a combined PL of $28,010

Add in the +/- $5k per month that I put on my AmEx PRG without the increase in PL is jacking up the overall utilization and holding back my Fico scores.

Is there a way to prevent this or should I just stop using my AMEX?

Thanks,

Scott

Re: AMEX PRG (NPSL) balance reflecting in overall utilization of revolvers?

RSX — Fri, 24 Jul 2020 17:14:19 GMT

i had the same scenario with my Amex Green card

paying it off before the statement posts is the only way to avoid it

Re: AMEX PRG (NPSL) balance reflecting in overall utilization of revolvers?

Anonymous — Fri, 24 Jul 2020 17:35:00 GMT

Dang! I was afraid of that

My bill is due on the 28th and the statement cycles on the 3rd

It will hurt to pay the June Statement of $5198 on 7/28 and the July Statement of $~4000 on the 2nd

Re: AMEX PRG (NPSL) balance reflecting in overall utilization of revolvers?

RSX — Fri, 24 Jul 2020 17:39:30 GMT

i get it - but it should only be one month of pain - then going forward you will always be caught up

Re: AMEX PRG (NPSL) balance reflecting in overall utilization of revolvers?

cashorcharge — Fri, 24 Jul 2020 21:42:12 GMT

I've had to do some hard math with regards to my own Util and AMEX. If you're granted a "credit limit" or (Pay over time) on a regular CHARGE card, they will report the balance you carried when the statement generates and if you look at the reporting services, your "available credit" will NOT include the Credit Line that AMEX gives you and your TOTAL DEBT will include the balance. If you look at what calculate as your utilization...the balance of your debt to your credit limit..the AMEX total doesn't factor in the percentage they display....at least in my case with the reporting services I use. If they've issued you a credit card...not a Charge Card with a Pay Over Time limit, then the equation is different.

Simple Example for CHARGE card with credit limit:

$100,000 Credit Limit Total across your profile

$5000 CC Balance with Bank X

$5000 AMEX Balance

Total Debt $10,000 and you'd think would be 10% utilization but my report shows 5% since the AMEX debt is posting..but the calculation for the 5% Util isn't counting the $5000 AMEX balance.

The only way to not have the $5000 balance not post to your credit and get included in your "total debt" is to pay BEFORE the statement cuts. AMEX is pretty good about posting the updated balance to your report within 24 hours of the statement issue.

Re: AMEX PRG (NPSL) balance reflecting in overall utilization of revolvers?

Citylights18 — Sun, 26 Jul 2020 13:46:55 GMT

@cashorcharge wrote:
I've had to do some hard math with regards to my own Util and AMEX. If you're granted a "credit limit" or (Pay over time) on a regular CHARGE card, they will report the balance you carried when the statement generates and if you look at the reporting services, your "available credit" will NOT include the Credit Line that AMEX gives you and your TOTAL DEBT will include the balance. If you look at what calculate as your utilization...the balance of your debt to your credit limit..the AMEX total doesn't factor in the percentage they display....at least in my case with the reporting services I use. If they've issued you a credit card...not a Charge Card with a Pay Over Time limit, then the equation is different.

Simple Example for CHARGE card with credit limit:
$100,000 Credit Limit Total across your profile
$5000 CC Balance with Bank X
$5000 AMEX Balance
Total Debt $10,000 and you'd think would be 10% utilization but my report shows 5% since the AMEX debt is posting..but the calculation for the 5% Util isn't counting the $5000 AMEX balance.

The only way to not have the $5000 balance not post to your credit and get included in your "total debt" is to pay BEFORE the statement cuts. AMEX is pretty good about posting the updated balance to your report within 24 hours of the statement issue.

This seems accurate to the way mine posts.

Re: AMEX PRG (NPSL) balance reflecting in overall utilization of revolvers?

SouthJamaica — Sun, 26 Jul 2020 15:12:21 GMT

@Anonymous wrote:
The MyFico score/reports are showing the balance of my AMEX w/ NPSL reflecting in my overall credit balances without increasing my PL and thus scewing my raw utilization.

Every bureau says that "things affecting your credit" is "high utilization"

My real utilization on Revolvers is ~30% w/ a combined PL of $28,010
Add in the +/- $5k per month that I put on my AmEx PRG without the increase in PL is jacking up the overall utilization and holding back my Fico scores.

Is there a way to prevent this or should I just stop using my AMEX?

Thanks,

Scott

Yes, or pay it off before statement cuts, as @RSX suggests

Re: AMEX PRG (NPSL) balance reflecting in overall utilization of revolvers?

K-in-Boston — Mon, 27 Jul 2020 15:13:44 GMT

@Anonymous wrote:
The MyFico score/reports are showing the balance of my AMEX w/ NPSL reflecting in my overall credit balances without increasing my PL and thus scewing my raw utilization.

Every bureau says that "things affecting your credit" is "high utilization"

My real utilization on Revolvers is ~30% w/ a combined PL of $28,010
Add in the +/- $5k per month that I put on my AmEx PRG without the increase in PL is jacking up the overall utilization and holding back my Fico scores.

Is there a way to prevent this or should I just stop using my AMEX?

Thanks,

Scott

It's really important to note that despite what may be showing on the front-end of a credit monitoring website, charge card balances do not affect the revolving utilization metrics of scoring on modern credit scoring algorithms. You could have a $30,000 balance on your charge card and it would not impact the revolving utilization metrics whatsoever, unless for some bizarre reason a lender were using FICO 98 or earlier version that includes NPSL cards in revolving utilization and uses the highest reported balance as the card's limit.

The "high utilization" negative reason code would be correct, as your "real utilization" being 30% is considered quite high.

I wouldn't scramble to pay Amex charge cards prior to the statement date to prevent them from showing a balance, and would instead concentrate on getting your overall revolving utilization down.

Re: AMEX PRG (NPSL) balance reflecting in overall utilization of revolvers?

SouthJamaica — Mon, 27 Jul 2020 17:19:47 GMT

@K-in-Boston wrote:
@Anonymous wrote:
The MyFico score/reports are showing the balance of my AMEX w/ NPSL reflecting in my overall credit balances without increasing my PL and thus scewing my raw utilization.

Every bureau says that "things affecting your credit" is "high utilization"

My real utilization on Revolvers is ~30% w/ a combined PL of $28,010
Add in the +/- $5k per month that I put on my AmEx PRG without the increase in PL is jacking up the overall utilization and holding back my Fico scores.

Is there a way to prevent this or should I just stop using my AMEX?

Thanks,

Scott

It's really important to note that despite what may be showing on the front-end of a credit monitoring website, charge card balances do not affect the revolving utilization metrics of scoring on modern credit scoring algorithms. You could have a $30,000 balance on your charge card and it would not impact the revolving utilization metrics whatsoever, unless for some bizarre reason a lender were using FICO 98 or earlier version that includes NPSL cards in revolving utilization and uses the highest reported balance as the card's limit.

The "high utilization" negative reason code would be correct, as your "real utilization" being 30% is considered quite high.

I wouldn't scramble to pay Amex charge cards prior to the statement date to prevent them from showing a balance, and would instead concentrate on getting your overall revolving utilization down.

I've seen numerous instances of lenders, especially credit unions, using the older scoring models, and noticed that a major lender like Capital One still uses one of the old scoring models for its CLI's.

Re: AMEX PRG (NPSL) balance reflecting in overall utilization of revolvers?

K-in-Boston — Mon, 27 Jul 2020 18:05:02 GMT

@SouthJamaica wrote:
I've seen numerous instances of lenders, especially credit unions, using the older scoring models, and noticed that a major lender like Capital One still uses one of the old scoring models for its CLI's.

I think we're speaking about various degrees of "older models."

"Older models" as it pertains to NPSL issues would mean things like TU-98, Beacon 96, etc. which were widely used in the 2000s. Models like the common mortgage scores (CapOne does sometimes use TU 04) were built after the NPSL issue with revolving utilization had been addressed. This wasn't unique to Amex and Diners Club type charge cards, but also to the original Visa Signature cards which reported no limit. While certainly some lenders are using pre-FICO 8 scores, I can't recall the last time I heard of someone being denied for credit because their Classic 98 score was too low.