Credit Utilization? - Another Question

[JBoswell]

I was told before on this site, by sidewinder I think, that credit limit and thus utl. isn't counted on closed accounts. I had been worried because my Chase CC was showing a limit of $100 when it should have been $22,000. But when I was checking my credit report on here it said that:

"Ratio of your revolving balances to your credit limits: 15056%"

The balance on that card was $15,056 at the time I got this report, so it seems as though it is being counted.

If it isn't being calculated on closed accounts, why is my ratio looking like that? is that how it appears to everyone? or just how it shows on MyFico? I'm just confused as to how that whole thing works with closed cards. My husband has two closed as well, if the debt to credit is still being taken into account we'd work at paying those down immediately, if not, we would focus on paying down other things and saving money twords the downpayment on our home. Unfortunately we don't have enough money to do both, so I want to be sure of what's being factored in before prioritizing where the money will go.

Thanks for any help!

Message Edited by JBoswell on 04-18-2009 09:17 AM

[2wheel]

is it a chase freedom card?? it might be that it is a signature card which is a charge card and not a credit card. mine did that for a while till I asked chase for a product change and then it reported correctly. I think this might be your problem call chase and ask them if its a signature card. If so switch it to a non-signature and when it reports again it will give you the credit limit

[JBoswell]

yea, I've already spoken to Chase several times, it's not a signature card. I was more or less just wondering about the credit utl. on closed cards and how that reports to the credit bureaus. The chase card itself is a whole other issue for another time

[Anonymous]

Ohhhhh, so the account is closed and you have a really high balance on it?  Yes, that will greatly factor into the scoring. The problem now is say you have a $1000 limit and you had a $1000 charged on the card, you are already at 100% util on that card, when you close it you now have a $0 CL but you still have a $1000 balance charged on the card. That's really bad and will tank your score.

[Anonymous]

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JBoswell wrote:

I was told before on this site, by sidewinder I think, that credit limit and thus utl. isn't counted on closed accounts. I had been worried because my Chase CC was showing a limit of $100 when it should have been $22,000. But when I was checking my credit report on here it said that:

"Ratio of your revolving balances to your credit limits: 15056%"

The balance on that card was $15,056 at the time I got this report, so it seems as though it is being counted.

If it isn't being calculated on closed accounts, why is my ratio looking like that? is that how it appears to everyone? or just how it shows on MyFico? I'm just confused as to how that whole thing works with closed cards. My husband has two closed as well, if the debt to credit is still being taken into account we'd work at paying those down immediately, if not, we would focus on paying down other things and saving money twords the downpayment on our home. Unfortunately we don't have enough money to do both, so I want to be sure of what's being factored in before prioritizing where the money will go.

Thanks for any help!

Message Edited by JBoswell on 04-14-2009 08:26 AM

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Yes, I commented on closed accounts on this message. But, what I said was closed accounts with balances are calculated into your util....but the CL is not. This is my understanding, because on a closed account, you have no CL.

So, it really doesn't matter if your CL shows $100 or $100000.

This is my understanding.

[Anonymous]

Ok, I must make a correction.

I do some more researching and reading on the forums. The spouse has a CC that is closed with a balance(No longer), but they closed w/o notice and a balance was reported.

The CL is still counted........I did not think this was the case. And I apologize for giving incorrect information.

So, having the CL correct may actually help you.

[JBoswell]

So I sent a letter to chase about the credit limit, and about a week later score watch sent me an update saying that "comsumer disputes investigation in process" and then a day later it updated again saying the same thing, but also "amount in H/C column is credit limit"

Now on my TU Report it shows like this:

Balance [?] $14,308
Current Status [?] Paid or paying as agreed
Past Due Amount [?] $0
Credit limit [?] $100
Largest past balance [?] $18,297
Terms [?] MIN
Account Type [?] Revolving Account
Account holder [?] Individual Account
Scheduled payment amount [?] $322

And on my EQ Report:

Balance [?] $14,308
Current Status [?] Paid or paying as agreed
Past Due Amount [?] Not Reported
Largest past balance [?] $100
Terms [?] Not Reported
Account Type [?] Revolving
Account holder [?] Individual
Scheduled payment amount [?] $322

it doesn't even show a credit limit and says the largest past balance is $100 and so, ...what is H/C column?

and also when something is "being investigated" does it factor into your credit score in the same way?

Message Edited by JBoswell on 04-18-2009 09:16 AM

[Anonymous]

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JBoswell wrote:

it doesn't even show a credit limit and says the largest past balance is $100 and so, ...what is H/C column?

H/C column is High Credit or largest past balance. When no CL is reported, the scoring formula uses the H/C for your limit. This is true on open and closed accounts. For instance, CFNA/Firestone doesn't report limits, so the H/C is used for limit when calculating util.

and also when something is "being investigated" does it factor into your credit score in the same way?

No, certain aspects about it is ignored.

Message Edited by JBoswell on 04-18-2009 09:16 AM

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[JBoswell]

1. So does that mean that the "credit limit" would be calculated as the $18,000 instead of the $100?
   
2. If some things are "ignored" does it impact your credit score? As in should I expect my score to drop again when they are done "investigating"?

[Anonymous]

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JBoswell wrote:

1. So does that mean that the "credit limit" would be calculated as the $18,000 instead of the $100?
   
2. If some things are "ignored" does it impact your credit score? As in should I expect my score to drop again when they are done "investigating"?

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1-- No, because TU is reporting a CL. High balance is only used if no CL is listed.

2-- Depends. If it dropped when the account was marked in dispute, then it could possibly raise back up when it is no longer in dispute or it could drop even more, depending on the changes made.

The things that are ignored are not included in your score anymore....if those things were helping-- then your score drops, if they were hurting-- then your score rises. But those changes could be temporary based on the results of the disputes.

Message Edited by sidewinder on 04-18-2009 10:03 AM