@Anonymous wrote:I'm interested in applying for one or two rewards cards later this year and want to be mindful of how an upcoming balance transfer will impact my score.
In a nutshell, I plan to basically transfer a majority of my balances to one card which will be close to maxed out ($7500). My other cards (total credit limit ~$40k over 6 cards) will be zeroed out. I'm going to do the BT either way, as it makes sense on the FC's I will save, but what I'm wondering:
1) Will I be excessively dinged/refused because of the high utilization/max out on the one card or will it be viewed more favorably as ~ 16% total utilization ($7500/$47500)? If you exceed 90% of its limit you will be dinged extra points for being maxed out on it. I would not worry about it till you are ready to app.
2) If it is the negative, and therefore based on the one card utilization, is there a general/rule of thumb minimum utilization rate I need to reach on that BT card before I reach a better credit score "bracket" for new credit consideration? less than 30% prior to app would be better, less than 10% optimum. I realize that the lower the better, but I'd like to take advantage of some rewards programs asap while I pay off that 0% BT
3) Lastly, do potential creditors ever take into consideration the reasons of a high utilization ex. 0% BT to save interest/pay loan down vs. high spending when making decisions or is it simply a bottom line thing? Sure you could explain why its high on that card on recon if denied
Thanks in advance to any help you can provide on my questions!
