topic Re: MY TOTAL CREDIT UTIL has not decreased even though my balance on my CC's are very LOW.. in Rebuilding Your Credit

MY TOTAL CREDIT UTIL has not decreased even though my balance on my CC's are very LOW..

PlayingTheCreditGame — Thu, 24 Dec 2009 06:37:52 GMT

I am in the process of rebuilding my credit. And after reading a couple of posts on this forum and others like it, I have decided to keep my balances low on the 2 cc's that I have as an attempt to lower my Credit utilization hoping for an immediate increase in my score. I have managed to keep my balance under $100 on my Cap 1 credit card for over a month now . I am using credit keeper with HSBC to track my scores. Cap 1 has also auto increased my limit to $1500. I requested an increase w/ HSBC but was only given $100, now I am at $400 after having this card for over a year and a half! But when I checked my report a few days ago, even after the cli's and low balance, my credit utilization is only at 35% and that's for my equifax report which was initially at 62% or so before these positive changes took place. In addition, my score only increased by 7 points from 665. My overall or PLUS score got a 10 pts boost from 596. I am baffled by this. I thought by keeping my utilization low, I would instantly get a significant increase in my score, at least 50 pts if I were below 50% of Util....but what I am really confused about is why my util is even at 35% if I am only using about 5% of my total credit limit!??? My total credit limit is only $1900 yes, but I am only carrying a $96 balance on my cap 1 card and 0 on the HSBC card. I have about 7 collection accounts, 5 of them are more than 4 years old and only 2 of them were cc's, the others are just cell phone accts and a Wachovia Bank overdraft collection which I disputed and Dv'd. Could those collections be bringing my utilization down? If so, is that proper reporting??? Please help me understand because I thought that utilization was calculated by dividing the amount of credit being used on your revolving accts over your credit limit??? Also all the 3 credit bureaus seem to be showing the correct credit limits on both cards (but with slightly different available credits) yet they are showing my util at 35% or more??? I am thinking about may be getting a secured cc or opening up some new ccs just so i can have more available credit thus bringing down my util. I haven't applied for any new credit in the past 12 months and both of my cc's are about 2 yrs old. I need to increase my scores. I AM SOOO CONFUSED! What do I do??? PLEASE HELP!!!

P.S. I also have student loans totalling about $30k, could that be a factor in included in util calculation as well?

as of 12/21/09: Ex 632 ( avail cred 1790$) , Eq 672 (avail cred 1806$), TU 581(avail cred $1407$)

Re: MY TOTAL CREDIT UTIL has not decreased even though my balance on my CC's are very LOW..

PlayingTheCreditGame — Thu, 24 Dec 2009 06:42:16 GMT

I wanted to add that all my student loans are current and never lates!

Re: MY TOTAL CREDIT UTIL has not decreased even though my balance on my CC's are very LOW..

breakthecycle — Thu, 24 Dec 2009 12:03:47 GMT

It can take up to 2 months for the bureaus to update your utilization. Wait 60 days after getting your balances down less than 10% which you say you have. Then recheck your scores. Relax you are rebuilding it doesn't happen over night. You are going to drive yourself crazy by checking scores frequently. Wait one more month and you should see improvement if your utilization is as low as you posted.

Re: MY TOTAL CREDIT UTIL has not decreased even though my balance on my CC's are very LOW..

MarineVietVet — Thu, 24 Dec 2009 23:59:57 GMT

I broke your long message into several paragraphs which makes it much easier for me to follow. I hope you don't mind.

But when I checked my report a few days ago, even after the cli's and low balance, my credit utilization is only at 35% and that's for my equifax report which was initially at 62% or so before these positive changes took place. In addition, my score only increased by 7 points from 665. My overall or PLUS score got a 10 pts boost from 596. I am baffled by this. I thought by keeping my utilization low, I would instantly get a significant increase in my score, at least 50 pts if I were below 50% of Util....but what I am really confused about is why my util is even at 35% if I am only using about 5% of my total credit limit!???

My total credit limit is only $1900 yes, but I am only carrying a $96 balance on my cap 1 card and 0 on the HSBC card. I have about 7 collection accounts, 5 of them are more than 4 years old and only 2 of them were cc's, the others are just cell phone accts and a Wachovia Bank overdraft collection which I disputed and Dv'd. Could those collections be bringing my utilization down? If so, is that proper reporting???

Please help me understand because I thought that utilization was calculated by dividing the amount of credit being used on your revolving accts over your credit limit??? Also all the 3 credit bureaus seem to be showing the correct credit limits on both cards (but with slightly different available credits) yet they are showing my util at 35% or more??? I am thinking about may be getting a secured cc or opening up some new ccs just so i can have more available credit thus bringing down my util. I haven't applied for any new credit in the past 12 months and both of my cc's are about 2 yrs old. I need to increase my scores. I AM SOOO CONFUSED! What do I do??? PLEASE HELP!!!

Those collections are really hurting you whether they are paid or not. You need to try and get those removed. They are offsetting any boost you might receive from getting your utilization down. They are not factored into utilization and are a major negative.

As was already mentioned it might take a month or two for all the balances to report correctly. Just give it time.

Good luck in your rebuilding journey.

From a BK years ago to:
7/09 TU-742 EQ- 779
8/09 TU-765 EQ- 783
9/09 EX pulled by lender 802

You can do the same thing with hard work.

Message Edited by marinevietvet on 12-24-2009 05:59 PM

Re: MY TOTAL CREDIT UTIL has not decreased even though my balance on my CC's are very LOW..

PlayingTheCreditGame — Thu, 24 Dec 2009 18:59:08 GMT

That is perfectly fine if it makes it easier for everyone to read. You are right, I suppose I should just wait a couple more months and see if i can get any significant increase in my score and decrease in util. But i want to make sure i understand something, so you do agree that the collections are calculated in utilization or are they just affecting my score simply bc they are reporting...most are over 4 yrs old??

Thank you both for replying so quickly.

Re: MY TOTAL CREDIT UTIL has not decreased even though my balance on my CC's are very LOW..

MarineVietVet — Thu, 24 Dec 2009 22:02:12 GMT

@PlayingTheCreditGame wrote:
That is perfectly fine if it makes it easier for everyone to read. You are right, I suppose I should just wait a couple more months and see if i can get any significant increase in my score and decrease in util. But i want to make sure i understand something, so you do agree that the collections are calculated in utilization or are they just affecting my score simply bc they are reporting...most are over 4 yrs old??

Thank you both for replying so quickly.

To be honest I'm not sure how to answer this and I don't want to give you wrong information. Let's wait for someone who actually knows to reply.

Re: MY TOTAL CREDIT UTIL has not decreased even though my balance on my CC's are very LOW..

fused — Thu, 24 Dec 2009 22:28:01 GMT

PlayingTheCreditGame wrote:

That is perfectly fine if it makes it easier for everyone to read. You are right, I suppose I should just wait a couple more months and see if i can get any significant increase in my score and decrease in util. But i want to make sure i understand something, so you do agree that the collections are calculated in utilization or are they just affecting my score simply bc they are reporting...most are over 4 yrs old??

Thank you both for replying so quickly.

Welcome to the forums!

While charge-offs being reported by the original creditor do factor in utilization calculations, collections do not. In general, derogatory items have less of an impact after two years. That said, its ceratinly possible that your collections that are over four years old are still hurting you.

Keep in mind there are multiple utilization calculations and here are some of them: individual revolving utilization (per card), overall revolving utilization (all revolving accounts) and installment utilization. The first two affect scores the most, while installment utilization carries far less weight in FICO scoring. For me, I keep only 1% util on one my revolving cards and this is what reports to the CRAs. The rest report doughnuts.

Do you know your EQ and TU FICO scores? Are your collections reporting as paid?

Re: MY TOTAL CREDIT UTIL has not decreased even though my balance on my CC's are very LOW..

MarineVietVet — Thu, 24 Dec 2009 23:47:06 GMT

@fused wrote:

Welcome to the forums!

While charge-offs being reported by the original creditor do factor in utilization calculations, collections do not. In general, derogatory items have less of an impact after two years. That said, its ceratinly possible that your collections that are over four years old are still hurting you.

Keep in mind there are multiple utilization calculations and here are some of them: individual revolving utilization (per card), overall revolving utilization (all revolving accounts) and installment utilization. The first two affect scores the most, while installment utilization carries far less weight in FICO scoring. For me, I keep only 1% util on one my revolving cards and this is what reports to the CRAs. The rest report doughnuts.

Do you know your EQ and TU FICO scores? Are your collections reporting as paid?

Thanks fused. That's what was unclear in my mind. Now the trick is to remember that longer than a day or two. I try and write tips like that down but there are so many to keep track of.

Re: MY TOTAL CREDIT UTIL has not decreased even though my balance on my CC's are very LOW..

PlayingTheCreditGame — Fri, 25 Dec 2009 17:47:06 GMT

Thank you for breaking down utilization for me. I was only aware of one type. This makes perfect sense to me now. I was thinking about getting 2 more cc's or may be a sec cc thru my CU in order to get more available credit. I have already 2 cc's but about 2 yrs old and 4 inq's that should be falling off later next yr. Some student loans, current, and about 7 yrs-old. Is it a good idea to open new accts for more avail credit and how would that affect the average age of my accts? Thank you in advance and to all that replied.

Re: MY TOTAL CREDIT UTIL has not decreased even though my balance on my CC's are very LOW..

Boldilocks — Mon, 28 Dec 2009 01:58:06 GMT

Also creditkeeper only updates once a month - and the scores are fake anyway.

Re: MY TOTAL CREDIT UTIL has not decreased even though my balance on my CC's are very LOW..

PlayingTheCreditGame — Mon, 28 Dec 2009 06:00:01 GMT

I have checked my Fico Score today for equifax and it is showing at 684, 3-5 days ago I checked it on credit keeper and it was showing at 672. I guess the scores are pretty close in my case.

Re: MY TOTAL CREDIT UTIL has not decreased even though my balance on my CC's are very LOW..

PlayingTheCreditGame — Mon, 28 Dec 2009 06:03:23 GMT

I am also happy to report that my utilization is WAAY DOWN on myfico on my Eq report at a very low 6%. I am so proud of myself! That was exactly what I was hoping for. And Fico simulator advised that if I keep doing what I am doing, in the next 3 months my score will be in 724-773 range! I can't wait!

Re: MY TOTAL CREDIT UTIL has not decreased even though my balance on my CC's are very LOW..

Boldilocks — Mon, 28 Dec 2009 13:55:59 GMT

I used Creditkeeper for a while (free trial) and ended up cancelling - truly as a CMS (credit monitoring system) it is not very good because it allows you to pull your reports only once a month. When you are rebuilding, changes can happen daily. I use Credit Check Total - you can pull a new report every day.

Remeber, though, that none of the scores on those sites are real. They might be close right now, but as people here are fond of saying, even a stopped clock is right twice a day. Right now my TU fako is 680 and my actual fico is 725! Plus the advice that they give you to improve your score can just be flat out wrong and could damage your score in the long run. Use Credit Keeper and its ilk for reports, and fico for your scores.

Congrats on the bump and hopefully you'll see that big increase over the next few months as you keep your utils low!!

Re: MY TOTAL CREDIT UTIL has not decreased even though my balance on my CC's are very LOW..

PlayingTheCreditGame — Wed, 30 Dec 2009 03:55:31 GMT

Thanks for the tips!

Norland Group

PlayingTheCreditGame — Fri, 04 Mar 2011 17:24:36 GMT

I helped a friend of mine DV Norland Group for a Macy's store card collection. She sent the letter certified mail to Norland Group collections. The response she got was from Macy's. They basically validated the debt. She got no response from the collection agency. My quesyion is I guess, since the original creditor validated the debt, if my friend wanted to negotiate for a PFD, how good how her chances? Should she deal directly with Macy's for a PFD? Or offer the collection agency a PFD? How should she go about this?