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Question about CC Balances & FICO Score

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New Contributor

Question about CC Balances & FICO Score

After reading the forums about how to effectively manage credit cards and to achieve a higher FICO score I have learned that you should have about 8 or 9% of revolving credit each month compared to your total credit limit.  My question is this though.  If I have 10 cards totalling $50,000 in credit limit, should I have about $4,000 total revolving posted each month or should it be 8% of each card?  I usually use my AMEX which has a 10k limit on it and then have about $800 post to it while leaving nothing on the other cards.  That would be about 8% of just one card.  Am I doing it wrong?

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Frequent Contributor

Re: Question about CC Balances & FICO Score

It's not really totally clear how the FICO is calculated. The difference in your score is probably minimal with 8% overall vs. 8% on each card, so don't drive yourself crazy trying to do each card. Also, you can spend more, just pay down the balances to ~8% before your statement reports. Some creditors are also sensitive to DTI, so make sure to keep that under control as well.

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New Contributor

Re: Question about CC Balances & FICO Score

Ok thanks.  I really only use one card, my AMEX.  Since I have 50k in total credit line over all of my cards, I was just curious on if I should have 800 post on my 10k card or 4k post on my 10k card.  Seems like I might be trying too hard.

Message 3 of 5
Super Contributor

Re: Question about CC Balances & FICO Score

You do not have to let 8%- 9% of your revolving balances report to achieve a high FICO score.  If you been managing credit for a while, and you have no baddies, you can still maintain a high FICO score.  I've been able to maintain high scores with only 1% balance reporting.  Some months, I let no balance report.  My overall revolving credit lines total $59K. 

 

Also, you certainly do not have to carry a balance on all 10 of your cards.   I have 10 cards too.  I use no more than 2 cards at a time each month. 

Message 4 of 5
Valued Contributor

Re: Question about CC Balances & FICO Score

I seriously wouldn't worry too much about your UTIL % month to month, unless it's over 35% - which you are nowhere near at. I would only worry about it, if you were looking to obtain a new CL (CC, Loan, mortgage, etc...). If that is the case, you want your UTIL % reporting under 10% to reflect your best possible score. If not, I would continue business as usual. As long as you keep paying your CCs, loan, mortgage, and have no baddies or late payments, over time...your score will keep going higher and higher, regardless if you are at 10% UTIL or 25% util for the month. AAoA also plays a huge factor in your fico score too!

 

 

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