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How is Uti figured?

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JMMD
Frequent Contributor

How is Uti figured?

It is the total CC limits divided by balance of the total? Or is it figured by each card and that card's balance? For instance, right now I have $1500 credit limits between 4 cards but I only have a balance on one for $75. That card only have a $400CL. What would my Uti be?

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Gunnar419
Valued Contributor

Re: How is Uti figured?

It's not really an either/or. For scoring purposes, it's BOTH overall and per card.

 

In your situation, the overall util is the main thing. $75 used over $1,500 total lines gives you a util of 5% if I'm doing my math right this early in the morning. And that's the most important figure.

 

$75 on a $400 CL card also gives you 19% util on that card. 19% util on one card won't help you or hurt you particularly. 

 

But let's say you let a balance of $375 util report on that one card and still had zero on the rest. Then you'd have an overall util of 25% (which is also not bad, though MyFico people will scold you for it). But your util ON THAT ONE CARD would be almost 94% -- and alarm bells would go off in the scoring systems because that's considered maxed out. Having any card, even one card, maxed out, gets you a ding in your score.

 

So the simple answer: utilization is the overall balance to your overall credit. But individual card balances are also watched and considered in scoring.

 

Message 2 of 5
JMMD
Frequent Contributor

Re: How is Uti figured?


@Gunnar419 wrote:

It's not really an either/or. For scoring purposes, it's BOTH overall and per card.

 

In your situation, the overall util is the main thing. $75 used over $1,500 total lines gives you a util of 5% if I'm doing my math right this early in the morning. And that's the most important figure.

 

$75 on a $400 CL card also gives you 19% util on that card. 19% util on one card won't help you or hurt you particularly. 

 

But let's say you let a balance of $375 util report on that one card and still had zero on the rest. Then you'd have an overall util of 25% (which is also not bad, though MyFico people will scold you for it). But your util ON THAT ONE CARD would be almost 94% -- and alarm bells would go off in the scoring systems because that's considered maxed out. Having any card, even one card, maxed out, gets you a ding in your score.

 

So the simple answer: utilization is the overall balance to your overall credit. But individual card balances are also watched and considered in scoring.

 


Thanks for explaing! I appreciate it!

Message 3 of 5
Anonymous
Not applicable

Re: How is Uti figured?


@JMMD wrote:

It is the total CC limits divided by balance of the total? Or is it figured by each card and that card's balance? For instance, right now I have $1500 credit limits between 4 cards but I only have a balance on one for $75. That card only have a $400CL. What would my Uti be?


Total is overall balances divided by the overall CLs.

Message 4 of 5
JMMD
Frequent Contributor

Re: How is Uti figured?


@Anonymous wrote:

@JMMD wrote:

It is the total CC limits divided by balance of the total? Or is it figured by each card and that card's balance? For instance, right now I have $1500 credit limits between 4 cards but I only have a balance on one for $75. That card only have a $400CL. What would my Uti be?


Total is overall balances divided by the overall CLs.


Thanks!

 

Message 5 of 5
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