Ideal Utilization ..

[Anonymous]

After a few months I have been seeing points go up and down based on utilization across all 3 CBRs. 

For example last month my utilization was 9% my scores went up across the board approximatley 6 points.  

This month my utilzation fell to 2% and my scores dropped 3 pts across all.  On the other hand my wife's utilzation went from 5% to 15% and her scores went up across the board. 

We are in the 1st gardening phase and the only changes have been balance decreases on mortgage (except TU) and auto. 

My question is what it the ideal target utilization %? 

[Medic981]

Ideal utilization is less than 9%. So 8.99% and below but not 0%.

[Anonymous]

OP, where are you getting your scores from?  It either sounds like some VS 3.0 BS (not FICO) or your scores are changing for a reason other than utilization.

A utilization drop from 9% --> 2% cannot result in a FICO score drop.

A utilization shift from 5% --> 15% cannot result in a FICO score gain.

If you are indeed looking at FICO scores (not VS) then you need to start looking for other reasons on your credit report as to why those score changes happened.

Medic is correct in his above reply with regard to ideal utilization [for FICO scoring purposes].

[Anonymous]

Nice response by Medic.  Three additional points:

(1)  The 8.99% cutoff is for total utilization.  A separate scoring factor is individual utilization (each card considered by itself).  The cutoff there is 28.99%.

(2)  There is never a scoring penalty for decreasing your utilization from (say) 8% to 0.2%.  This is why if a person needs to prepare for a really important credit app (e.g. mortgage, auto loan, CC that you are borderline for, etc.) it's simplest just to have all cards at $0 except one, with the remaining card reporting a small positive balance (e.g. $15 or whatever).  Doing this every month does not help you build a score over time, but it is a simple technique for making sure you all available points just before that important app.

(3)  Some people (Thomas Thumb, myself, and a few others) think that the actual dollar value owed on credit cards may also be a scoring factor.  Thus, suppose Bob and Fred have exactly five cards and identical profiles, except Bob's cards have a credit limit of $1000 each and Fred's have a CL of $40,000 each.  Both have exactly 8% utilization on all cards.  Bob has $400 of CC debt but Fred has $16,000.  It's possible that FICO has a scoring factor apart from utilization that penalizes the huge amount of CC debt that Fred is reporting compared to Bob.  That's all conjecture, but is one more reason why if a person needs to squeeze every extra point from his score (for some important app) it may have value to do the all zero except one with the small dollar value on the remaining card.

[SouthJamaica]

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@Anonymous wrote:

After a few months I have been seeing points go up and down based on utilization across all 3 CBRs. 

For example last month my utilization was 9% my scores went up across the board approximatley 6 points.  

This month my utilzation fell to 2% and my scores dropped 3 pts across all.  On the other hand my wife's utilzation went from 5% to 15% and her scores went up across the board. 

We are in the 1st gardening phase and the only changes have been balance decreases on mortgage (except TU) and auto. 

My question is what it the ideal target utilization %? 

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I can assure you that your overall utilization dropping from 9% to 2% did NOT cause a 3 point score drop. If anything it would have improved your scores.

Overall utilization from 1% to 9% is ideal.

[Anonymous]

Okay after some careful review I think that my drop was due to an June 2018 inquiry showing up. That is the only thing that can make sense  .. not that it took 3 months to show up but that it did finally show up. The inquiry is on all 3 reports.  

I can not find any information on my the increase on my wife's scores but it is strange that it is the same increase across all 3. 

 The increase is the same with Vantage and with FICO scores. 

[Anonymous]

Strange, to me, that the point loss/gain would be the same on both Vantage and fico for both you and your wife. I rarely read of folks who have scores that match on both models for both husband and wife.

On mine, my vantage scores are 80 something points lower than my real scores. On hubbys his vantage TU is 26 higher than his real score and his EQ is 40 something points lower than his real score. 😁

[Anonymous]

By "real score" above, clearly you mean "FICO score"... it's important to recognize however that in using the term "real score" you are therefore suggesting that the other score [VS] isn't real.  VS certainly does provide real scores, as they come from a scoring model... they are just far less meaningful than a FICO score.