topic Quick ? On CC Utilization in Rebuilding Your Credit

Quick ? On CC Utilization

Anonymous — Tue, 17 Nov 2015 14:31:10 GMT

The key is to have low utilization around 10-20% from what I have read. Now if I have 2 CCs is it the utilization of the cards combined or each individual card? They determine the utilization of that month at the end of each billing cycle?

Re: Quick ? On CC Utilization

Anonymous — Tue, 17 Nov 2015 16:51:51 GMT

Let one card report. And if u can less than 10%. Also, see if u can get third card. Optimal is 3 cards, one reporting less than 10%.

Re: Quick ? On CC Utilization

Anonymous — Tue, 17 Nov 2015 17:22:30 GMT

So are you saying to let one report with a balance every month and keep the other 2 paid off?

Re: Quick ? On CC Utilization

Anonymous — Tue, 17 Nov 2015 18:12:38 GMT

@Anonymous wrote:
So are you saying to let one report with a balance every month and keep the other 2 paid off?

Yes one card report with less than 10% utilization and pay the other two in full just before the statements cut, this will maximize your credit score.

Re: Quick ? On CC Utilization

Anonymous — Tue, 17 Nov 2015 18:14:15 GMT

@Anonymous wrote:
The key is to have low utilization around 10-20% from what I have read. Now if I have 2 CCs is it the utilization of the cards combined or each individual card? They determine the utilization of that month at the end of each billing cycle?

Utilization is your billing statement balance. The actual date of it reporting is not really relevant, the importand date is your statement closing date. You want to pay down the balance before that date. Only let one card report a balance for the best scoring.

Re: Quick ? On CC Utilization

RobertEG — Tue, 17 Nov 2015 18:37:43 GMT

Fair Isaac has stated that FICO scores utilization of revolving credit based on the combination of three factors; which are generally weigted in descending order of importance:

1. The overall % util of all revolving accounts; ideal appears to be approx 1-9%

2. The % util of each individual account; ideal appears to be one reporting 1-9%, with all others reporting 0%

3. The percentage of accounts reporting a balance; at least one should show a small balance, and percent with balance should be less than 50%

With only two cards, your percent with a balance is limited to only zero, fifty, or one-hundred percent.

Three cards gives more ability to keep below 50%, providing the additional possibility 0, 33, 67, or 100%

Larger number of cards obviously provide better opportunity to keep percent reporting balance under 50%.

Re: Quick ? On CC Utilization

Anonymous — Tue, 17 Nov 2015 22:56:11 GMT

@RobertEG wrote:
Fair Isaac has stated that FICO scores utilization of revolving credit based on the combination of three factors; which are generally weigted in descending order of importance:
1. The overall % util of all revolving accounts; ideal appears to be approx 1-9%
2. The % util of each individual account; ideal appears to be one reporting 1-9%, with all others reporting 0%
3. The percentage of accounts reporting a balance; at least one should show a small balance, and percent with balance should be less than 50%

With only two cards, your percent with a balance is limited to only zero, fifty, or one-hundred percent.
Three cards gives more ability to keep below 50%, providing the additional possibility 0, 33, 67, or 100%
Larger number of cards obviously provide better opportunity to keep percent reporting balance under 50%.

I have a 3rd card but havent activated it yet bcuz it's a credit one card and was told to stay away

Re: Quick ? On CC Utilization

Anonymous — Wed, 18 Nov 2015 03:54:43 GMT

This may be a stupid question, but will his credit one card still report even if he didn't activate it? My opensky account reported before i activated it

Re: Quick ? On CC Utilization

Anonymous — Wed, 18 Nov 2015 06:00:08 GMT

@Anonymous wrote:
This may be a stupid question, but will his credit one card still report even if he didn't activate it? My opensky account reported before i activated it

Yes, it does.

I opened a Walmart MC on 11/12 and on 11/15 I got alerts that a new account was on my TU and EX. I did not have the CC yet so could not have activated it. I just remembered something, I did make an online purchase on Walmart.com after the approval so I could get the first use statement credit, so I used the account.

I do believe the Credit One account is there because the OP did an app for it. Also got a HP for the app, I would bet.

I dont believe CCCs send out valid cards 'on approval' now, like they did years ago. They send prequal letters now.

HTH

Re: Quick ? On CC Utilization

Anonymous — Wed, 18 Nov 2015 06:42:07 GMT

I did get a HP since I applied for the card via their website. After receiving the card in the mail I didnt activate it because I started reading the bad reviews on them. Since I do have a HP for it should I just use it to my advantage for the next 11 months then close it? Will it hurt me worse if I close the account in a 11 month period?

Re: Quick ? On CC Utilization

Anonymous — Wed, 18 Nov 2015 07:18:03 GMT

@Anonymous wrote:
I did get a HP since I applied for the card via their website. After receiving the card in the mail I didnt activate it because I started reading the bad reviews on them. Since I do have a HP for it should I just use it to my advantage for the next 11 months then close it? Will it hurt me worse if I close the account in a 11 month period?

I have read that creditors dont like to see accounts closed in less time than one year, indicating a possible 'churner'. OTOH, I have read of people closing out an account within a short time frame and never noticing any ill will from it.

Personally, since I had already taken a HP for it, I would use it, especially since you are new to rebuilding and would benefit from new accounts.

Realistically, I would suggest you check the balance on the account very soon. I have a Credit1 account and they added account origination fees or the AF or something immediately. They are one of the predator CCCs and they 'live for the fees', and charging interest immediately.

HTH

Re: Quick ? On CC Utilization

Anonymous — Wed, 18 Nov 2015 07:38:14 GMT

I specifically asked the CSA at CreditOne when I called if I would be charged the AF if I didnt activate the card and he said no. Can I check the balance without activating the card/account?

Re: Quick ? On CC Utilization

Anonymous — Wed, 18 Nov 2015 19:27:49 GMT

That's a hard call, me personally I claw my face off everytime I take a hard inquiry, so I would have to use it .... but a hard inquiry isn't worth losing money or points over so.... I dunno