CU help

[kpiffy]

I'm sick to my stomach. My credit was a wreck a year and a half ago, so I got a Capital One card. I'd been keeping the utilization down to about 3% and paying it in full the whole time and a few of my other accounts that were in collections fell off, and my score was moving up. My husband and I were hoping to get a home loan next year. We recently moved and I  neede to use the Capital one card , so my utilzation was at 70%, but in the chaos of the move, I forgot to pay it  before the reporting date and so did my husband. I didn't actually have a payment due because I had a grace period going and I didn't have any interest added,  but my score dropped like 60 points!  I paid it as soon as I realized, but of course the damage was done. How long will it take for it to go back up to where it was, assuming I don't screw up like this again? Thanks in advance!

[Anonymous]

You can auto pay the card with your bank account.
I have it to autopsy the minimum amount even though I pay it in full each month.

Lates will stay on your report for 7 yrs.
As they age you will see less of an effect.

Usually in a year or two but you will not gain all your points back until the 7 years.

I would gw letter to try to get it removed.

[kpiffy]

Thank you for your reply! I guess I didn't explain that very well, but I didn't actually have a payment due at the time, because I had just paid it in full, but then a few weeks later, I used it, but because I was in the grace period, I didn't have a payment due....so to the best of my knowlgede, I didn't actually miss a payment, I just had a very high utilization at the time it was reported, which dropped my score.  Does that make sense? My real question is that I'm wondering if having my utilization very high  one time is going to keep my score down that low for 7 years?  Please tell me no. Please.

[Anonymous]

No it should not. Once it is paid down you should see your scores rise back up.

[kpiffy]

Oh, thank you! I was starting to panic! I appreciate your help! :-)

[Anonymous]

Here is an example of someone accidentally having a high utilization report

http://ficoforums.myfico.com/t5/Credit-Cards/Stupid-Mistake/m-p/4025716/highlight/true#M1131069

[kpiffy]

Well, that makes me feel a little better., thanks for posting that. I pray my score goes back up to where it was within a few months. I am going to put it on auto pay now, just to be on the safe side, but I don't anticipate having to have that high utilization again (knock on wood)... That just seems like an astronomical number of points for it to go down. I mean, I know CU is a big factor, but good lord!

[takeshi74]

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@kpiffy wrote:

We recently moved and I  neede to use the Capital one card , so my utilzation was at 70%, but in the chaos of the move, I forgot to pay it  before the reporting date and so did my husband. I didn't actually have a payment due because I had a grace period going and I didn't have any interest added,  but my score dropped like 60 points!  I paid it as soon as I realized, but of course the damage was done. How long will it take for it to go back up to where it was, assuming I don't screw up like this again?

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Relax.  Revolving utilization is determined at a given point in time and prior utilization doesn't matter unless you end stuck in a bucket.  Your score will recover when the new balance is reported.

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@kpiffy wrote:

That just seems like an astronomical number of points for it to go down.

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Nope.  It is the second biggest factor behind payment history (which is impacted by derogs).  That's why advice for building/rebuilding often starts out with "address your dergos and get your revolving utilization in check".

http://www.myfico.com/crediteducation/whatsinyourscore.aspx

It's not just the scoring impact either.  I had scores around 700 but 60% utilization or higher.  Chase would only grant me a $2K limit on a card with the highest APR offered.  6 months later I had my revolving utilization under 10% (I think closer to 2%) and I was instantly approved for a $25K card with the lowest APR offered.  I'm not saying that everyone who reduces their utilization to that degree will see the same results as utilization is just one factor among many.  I'm just pointing out how constricting high utilization can be even if all other factors are very good. 

Short term high utilization generally isn't an issue and one can easily recover from it.  It's prolonged high utilization that can lead to AA.

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@kpiffy wrote:

CU help

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FYI, CU is generally used around here to refer to credit union.

[kpiffy]

Oh, oops! I didn't know that about the CU abbreviation. Thanks for letting me know. :-) Also, appreciate the helpful info. I had never intended to use that much on the card,  I usually just use it for gas ; I got it specifically to help build my credit back up, so I'm glad to know that (hopefully) this one screw up won't affect me long term. 

[Anonymous]

Here is another thread recently where various people have recovered their points. You will too.
http://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/REALLY-Whacked-for-All-Zero-Balances/td-p...