topic Re: What to do about AU card with high utilization? in Rebuilding Your Credit

What to do about AU card with high utilization?

Anonymous — Sat, 01 Feb 2020 02:33:45 GMT

Hi everyone thanks for viewing my thread. Here is a brief history of my situation:

In Feb 2017 i lost my job and quickly got into a crap ton of debt for a 25 year old. Fastforward a year and a half and in November 2018 my Ch7 bk was discharged. Shortly after, dad made me an AU on the costco citi. I do believe this helped me quite a bit despite almost always being around 70%+ utilization (dad's spending, not mine). In April 2019 I opened a self lender installment loan hoping to diversify my credit and hopefully get the ball rolling and have basically left everything alone since then. Earlier this week I decided it might be time to open a CC all my own. Figured it wouldn't hurt to start aging some accounts up and hopefully dilute my utilization rate on the costco citi card.

So, last tuesday I pulled my FICO 8 (589) and applied for the Capital one Platinum and to my surprise, received an auto approval for $1,500, woohoo!

Now that I'm all motivated to continue increasing my score, I have a few Q's:

What would be the best thing to do concerning the AU card now that i have my own? Should I request to be removed asap? The chances of this card ever being below 9% utilization are pretty slim, but it is giving me 100% payment history since 2016.

If i were to keep the AU card (with it's high balance), should I keep my new card reporting $0?

Anybody have insight regarding how to get the highest CLI when my cap1 comes up for review after my first 5 payments?

Thanks!!

Re: What to do about AU card with high utilization?

Fico82 — Sat, 01 Feb 2020 03:33:52 GMT

I would remove myself only because of the high utilization. The way I see it is that you use his account as a tool to help open the doors for you . Same thing I did but luckily the account I'm on is 0% utilized. Now that you have a primary of your own and a self leader account time will be your best friend . Just my opinion and I'm no expert but any means. I'm sure others will chime in. Goodluck with your rebuild.

Re: What to do about AU card with high utilization?

OmarGB9 — Sat, 01 Feb 2020 05:40:48 GMT

That high utilization outweighs the length of credit benefit because utilization accounts for 35% of your score, while length of credit history accounts for 10%.

Re: What to do about AU card with high utilization?

Anonymous — Sat, 01 Feb 2020 14:22:49 GMT

@OmarGB9 wrote:
That high utilization outweighs the length of credit benefit because utilization accounts for 35% of your score, while length of credit history accounts for 10%.

Isn't it payment history that accounts for 35% of your score? And then amount of debt is another 30%ish?

Re: What to do about AU card with high utilization?

gdale6 — Sat, 01 Feb 2020 17:26:09 GMT

@Anonymous wrote:
@OmarGB9 wrote:
That high utilization outweighs the length of credit benefit because utilization accounts for 35% of your score, while length of credit history accounts for 10%.
Isn't it payment history that accounts for 35% of your score? And then amount of debt is another 30%ish?

yes and yes

Re: What to do about AU card with high utilization?

OmarGB9 — Sat, 01 Feb 2020 19:46:40 GMT

@Anonymous wrote:
@OmarGB9 wrote:
That high utilization outweighs the length of credit benefit because utilization accounts for 35% of your score, while length of credit history accounts for 10%.
Isn't it payment history that accounts for 35% of your score? And then amount of debt is another 30%ish?

Well either way, my point was that length of history is only worth about a third of what utilization is worth in terms of score. Therefore my advice to OP would be to remove himself.

Re: What to do about AU card with high utilization?

KJinNC — Sat, 01 Feb 2020 20:37:31 GMT

It sounds like your plan is to let the Cap One card and Self loan brew for a while before trying much else. So, I would say it doesn't matter that much whether you remove the card or leave it, for now. If I had to pick, I'd say remove, but I think it's ok to wait until you have additional credit goals if you like. JMO, and either way, good luck!