15 Point drop after one card over 50% but overall under 18% util, how to get points back?

[Superduper2014]

Hi guys, 

Trying to understand this. 

My overall credit card use is 18% of credit limits. 

I have one card that this month reported 64% of credit limit and immediately credit carma scores 15 point drop. 

They say that you should use 30% of the credit limit to have a "healthy" credit utilization, but I thought that overall credit utilization was what counted the most?

Is this the reason why I see sooooo many people here opening a myriad of credit cards so they can spend on them under 30% of each and spread the spending to increase scores?

What should I do to recover these points other than paying this card back to 30% of utilization?

Would opening another card or increasing credit limits on existing cards in order to have more available credit across the board help in any way when you are this high in utilization on 1 card?

Thanks for any insight.

Scores via Karma dropped to 732 on equifax and trans. 

[Gmood1]

First pull your real scores and see what they are, it only cost a $1. Just cancel before the trial ends.
https://www.experian.com/help/login.html

[DaveInAZ]

Yes, Credit Karma is good for reviewing your credit reports and seeing things like your one card is at 64%, but their scores are useless, no major creditor uses them.

And yes, taking any one card over 50% usage is a score killer, regardless of overall utilization. I learned that the hard way a few years ago, I think my score took a 20 point hit. And while they say under 30% is best, and it is, I've found that one or two cards over 30% but under 50% doesn't hurt your score too badly as long as overall utilization is under 30%, it's over 50% that's the killer. Here's the scoring of credit card utilization:

0-9%	Excellent
10-29%	Good
30-49%	Fair
50-74%	Poor
75%+	Very Poor

[SouthJamaica]

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@Superduper2014 wrote:

Hi guys, 

Trying to understand this. 

My overall credit card use is 18% of credit limits. 

I have one card that this month reported 64% of credit limit and immediately credit carma scores 15 point drop. 

They say that you should use 30% of the credit limit to have a "healthy" credit utilization, but I thought that overall credit utilization was what counted the most?

Is this the reason why I see sooooo many people here opening a myriad of credit cards so they can spend on them under 30% of each and spread the spending to increase scores?

What should I do to recover these points other than paying this card back to 30% of utilization?

Would opening another card or increasing credit limits on existing cards in order to have more available credit across the board help in any way when you are this high in utilization on 1 card?

Thanks for any insight.

Scores via Karma dropped to 732 on equifax and trans. 

---

1. Credit Karma scores are Vantage 3.0 scores, not FICO scores, and are meaningless.

2. You should pay the 64% card down to 28% or less.

3.  You should try to keep all cards at 28% or less, optimally having many report zero.

4.  You should get your overall utilization down from 18%  to 9% or less.

5.  In order to advise you on requests for credit limit increases and new card applications, we would need to know what cards you have and what your FICO scores are.

[Anonymous]

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@Superduper2014 wrote:

Hi guys, 

Trying to understand this. 

My overall credit card use is 18% of credit limits. 

I have one card that this month reported 64% of credit limit and immediately credit carma scores 15 point drop. 

They say that you should use 30% of the credit limit to have a "healthy" credit utilization, but I thought that overall credit utilization was what counted the most?

Is this the reason why I see sooooo many people here opening a myriad of credit cards so they can spend on them under 30% of each and spread the spending to increase scores?

What should I do to recover these points other than paying this card back to 30% of utilization?

Would opening another card or increasing credit limits on existing cards in order to have more available credit across the board help in any way when you are this high in utilization on 1 card?

Thanks for any insight.

Scores via Karma dropped to 732 on equifax and trans. 

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I know you hear that number often and so do I.  Let me interpret that though.  30% would be considered by many to be responsible borrowing.  It is certainly not the optimal level to be at for scoring purposes.

[CreditInspired]

@superduper2014 asked:
Is this the reason why I see sooooo many people here opening a myriad of credit cards so they can spend on them under 30% of each and spread the spending to increase scores?

IME, yes, but this is to keep my overall UT at less than 3% and any per card UT that has a balance at less than 8.9%.

Personally, for my spend and comfort level, 30% is way too high.

Example: I asked for CLIs on both my DiscoverIT and AmX ED because I anticipated making big purchases using those cards. Therefore, my UT on those cards would still be under 8.9%.

[Superduper2014]

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@SouthJamaica wrote:

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@Superduper2014 wrote:

Hi guys, 

Trying to understand this. 

My overall credit card use is 18% of credit limits. 

I have one card that this month reported 64% of credit limit and immediately credit carma scores 15 point drop. 

They say that you should use 30% of the credit limit to have a "healthy" credit utilization, but I thought that overall credit utilization was what counted the most?

Is this the reason why I see sooooo many people here opening a myriad of credit cards so they can spend on them under 30% of each and spread the spending to increase scores?

What should I do to recover these points other than paying this card back to 30% of utilization?

Would opening another card or increasing credit limits on existing cards in order to have more available credit across the board help in any way when you are this high in utilization on 1 card?

Thanks for any insight.

Scores via Karma dropped to 732 on equifax and trans. 

---

1. Credit Karma scores are Vantage 3.0 scores, not FICO scores, and are meaningless.

2. You should pay the 64% card down to 28% or less.

3.  You should try to keep all cards at 28% or less, optimally having many report zero.

4.  You should get your overall utilization down from 18%  to 9% or less.

5.  In order to advise you on requests for credit limit increases and new card applications, we would need to know what cards you have and what your FICO scores are.

---

Ok, I have calculated the amounts I would need to pay off in order to bring my card down to exactly 28%. 

This card will report in around 7 days, so I will be able to see what this does without any other changes to my report. 

I am hoping that I can see a good jump in credti scores from doing this. You figure at least what I came down right?

Also, I am going to completely pay off another card that has a promo APR expiring next month. This card will be report on the 6th of March. 

So, by then I will just have one card at 28% utilization and my overal Utilization will be way below 9%, which will be interesting to see if my credit truly jumps up. 

Thanks

[Anonymous]

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@Superduper2014 wrote:

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@SouthJamaica wrote: 

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1. Credit Karma scores are Vantage 3.0 scores, not FICO scores, and are meaningless.

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Ok, I have calculated the amounts I would need to pay off in order to bring my card down to exactly 28%. 

This card will report in around 7 days, so I will be able to see what this does without any other changes to my report. 

I am hoping that I can see a good jump in credit scores from doing this. You figure at least what I came down right?

Also, I am going to completely pay off another card that has a promo APR expiring next month. This card will be report on the 6th of March. 

So, by then I will just have one card at 28% utilization and my overal Utilization will be way below 9%, which will be interesting to see if my credit truly jumps up. 

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A number of people are letting you know that your scores from Credit Karma have no practical value.  But it sounds like you still are planning to use Karma as the place you use to get scores.... is that right?

Is the reason for this that you don't understand how to get FICO scores for free or for almost no cost?  If that's the problem, let us know and the folks here will walk you through that.

[Anonymous]

While it sounds super simple and obvious, any event that causes a FICO score to drop X points if reverses will cause a FICO score to increase X points.  That said, if your reported utilization went up Y%, all that is needed is for you to lower it Y% for your FICO scores to return to their previous place.  That of course assumes that no other [scoring] factors change during that time... so it's definitely an "all other things being equal" consideration.

[Anonymous]

@Superduper2014: these good folks are giving you good advice. Your scores will definitely jump absent any other interference if you follow their advice.