Trying to fully understand the PIF & Utilization...

[Carloscda40]

So I aquuired a secure DiscoveIT & Opensky cc last week. I only funded both cards with $200.

My scores are dismal, low 500's. My plan is to raise my scores to mid 600's or higher.

A couple of questions.

It's my undewrstanding from reading various posts here pif & keep utilization low.

So with the $200 limit spend say only $50 then when the bill comes pay that in full? That will raise my score?

Would adding another $100 to each card make a difference in utilization or my score?

Thanks in advanced!

[Anonymous]

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@Carloscda40 wrote:

So I acquired a secure DiscoveIT & Opensky cc last week. I only funded both cards with $200.

My scores are dismal, low 500's. My plan is to raise my scores to mid 600's or higher.

A couple of questions.

It's my understanding from reading various posts here pif & keep utilization low.

So with the $200 limit spend say only $50 then when the bill comes pay that in full? That will raise my score?

Would adding another $100 to each card make a difference in utilization or my score?

Thanks in advanced!

---

For FICO scoring purposes, one account needs to report a balance of less than 10%, so less than $20 and the other card should report a zero balance.  The 10% window applies regardless to the amount funded on each card. 

[Anonymous]

I try to keep this simple and straight to the point, no chaser...in a here's what to JUST DO fashion, if you need the details or want clarification just ask but below it's just steps

1) These cards are to 'play the game' only NOT to be buying ish...this is for credit profile manipulation only.
Put your head down for 10 reporting cycles.

2) Allow only 1 card to report $20-$25 balance, which would represent 10%-15% utilization of a $200 CL, which is fine
This also represents an overall 5%-7.5% utilization of the total $400 available credit (7.5% will be rounded to 8% via FICO)

3) No you do not 'need' to add $100 for utilization purposes, just mind the % of whatever the CL is...
10% of $200 reads the SAME as 10% of 20,000 as far as the scoring model works...
*Remember the "dumb" computer model is just doing a calculation, period.

4) IMO you're better off taking that extra $200 and opening a secured Discover card
Why?
The model ideally likes to see 3 revolving accounts being managed

Ppl screw this up all the time, it's better the gave 3 $200 separate TLs reporting and aging together vs 1 $600 TL

The more lines reporting decent DATA, the less RISKY looking the profile...less Risk = better risk score

* Ideally the model would like 3 revolvers + 1 installer, showing depth and credit mix
This is why I recommend that folks start with a SSL ( secured loan) first then take those same funds and secure a few CCs ( killing more birds, same funds) plus the 'payment' of the SSL provides for the only spend needed to show a little utilization on the CC

All wrapped up nicely

Let this video game play out on the CRAs for 10 months and BAM

With 4 TLs your profile is 40/40 or with 3 it's 30/30 on-time payments and a nice low utilization, the offers will pour in because the score can't help but to be solid plus the HP's are about to age out in 2 months.

It just takes discipline to play the video game, consistently and boringly over time, to often the ants in the pants can't stay still and ppl app to early

Yes, there may be some early 'D' or 'C' level offers made and most jump early and often at the bush leave offers and then are stuck in the bush leagues, much of their credit life..

Grow your score and profile big and strong FIRST and you're more likely to be coded to and stay in a higher tier your entire credit life

Rates and terms offered to you may be determined by how you're coded from your Day 1 entry, enter through the best door you can

[Carloscda40]

Thank you for all the info I'm going to be rereading this over time!

I'm going to also get those balances to $20 to report.

[Anonymous]

Darn it the auto spell thing is killing me

The term was bush league offers...there were a couple others but if you got confused just ask

Also since I'm a stickler above you said you'd get those balances to report $20
I just want to make sure you meant ONE balance of $20

We only want ONE account showing a balance with all others at 0%

This demonstrates low risk because the cards aren't being used but the little $20 shows that the profile isn't just dormant or totally dead.

By showing 'just' a little usage it means the lights are on someone's home and they are in outstanding management of their finances because 90-95% of the credit available to them is still on the table

They MUST have a handle on things...

If they were to ask for anything, of course they would be of LOW RISK

Not like that other profile where they look so THIRSTY sucking up 80% of what's available every month...who knows when the plates their juggling are gonna start falling....it won't be this MY 💰

That's how it's looked at😉

[HeavenOhio]

Make that a little under $18.00 rather than $20 on one of your cards. Less than 10% means 9% or less. 9.000001% will round up to 10%, and you won't get the benefit of being under 10%. To be safest, people go for 8.9% or less just to make sure nothing rounds up past 9%.

Also, on the card that reports a positive balance, make sure to leave at least $5. Banks may forgive small balances rather than bothering to bill you. In those cases, they'll report zero to the bureaus.

[Anonymous]

I got a cap1 secured card with 400 cl I use 385-397 a month and pay it off in full before the cut date and I received a cli yesterday after my 5th cut but that's just me everyone says keep the utilization down I want the creditor to know that I can use 95-97% of my credit line and pay it back in full.

[HeavenOhio]

Nathan, the utilization that matters is what goes on your credit report. Your utilization is in check because your Captial One card is reporting zero.

Is this your only card? If it is and points on your score are a concern, you're likely better off allowing your statement to cut with a small balance (between $5 and 8.9% of your card's limit). Pay in full right after the statement cuts, and you'll avoid interest charges. In other words, keep doing what you're doing except for cutting the small balance.

If you have multiple cards, allowing one card to report a small balance with the others reporting zero will optimize the utilization portion of your score. Most cards are like Capital One in that they report the statement balance on the statement date. Some cards, like US Bank and Chase, do things differently. If you acquire cards from those banks, feel free to ask about them, and people here can fill you in on the differences.

[Carloscda40]

My scores are in the mid 500's, If I keep my Utl low, PIF etc is it possible to have those scores near mid 600's or near 700 by this time next yr?

[Anonymous]

Each time you register an on time payment, each month you add to your average age of account and age of your inquiries, your profile and your score will get healthier.  By how much and how fast depends on the individual and what else is on your report, no one will be able to tell you for show.