Utilization Question...

[Andy77]

So, I wanted to see how doing the following will affect my utilization...

Right now I have 22 cards maxed (97k in debt with 101k total credit limits avail)  and I was going to pay 73k off, leaving me with only two cards reporting roughly 15k each,

20 cards will have a zero balance and the total avail credit between all of those would be 70k

If the remaining two cards with the balances are:

32k limit, 15k balance

20k limit, 15k balance

Question:

Will the two cards with the balances close to the limits affect my utilization so horribly I won't get approved for cards or CLI going forward unless I pay them down ?  OR

No, it won't affect me that badly since I am paying off 20 cards and now have 70k avail ?

Thank you

[Revelate]

15/32K is a minor ding if any.

15/20K is a harder sell; but even my own single maxxed out tradeline was something like 7 points on my dirty file so we're not looking at a huge penalty.

30/101K another minor ding; not trying to sermonize but chasing new accounts and CLI's are kinda irrelevant: if that 30K is on non-trivial APR's get your financial house in order by getting it paid off or refinanced TBH; however, paying 70K revolving debt is a monumental shift that's nothing but goodness financially.  Also I'm case in point it's not like one has to have a perfect file to get anything related to CC's (a few unicorns maybe excepted): lenders may not appreciate the 30K depending what you're claiming as income admittedly but that's still a big difference from 100K.

[RobertEG]

Your primary concern is adding new cards or getting higher credit limits?

[Andy77]

My main focus is paying off the remaining debt, but I was just curious how the remaining 30k would look as far as utilization goes.

Thank you

[RonM21]

If you pay down 70k in debt, essentially going from 96% util down to 30% that will probably cause a decent score boost depending on your overall profile. Each card is measured for it's own utilization as well as your overall combined,.if I'm not mistsken.

[Andy77]

Yea according to the simulators here, my scores are at 624 now...when I pay off the 73k should go to 714

I am excited.  I know I will still have around 23k but that is a LOT more manageable...

[takeshi74]

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@Andy77 wrote:

Will the two cards with the balances close to the limits affect my utilization so horribly I won't get approved for cards or CLI going forward unless I pay them down ?  OR

No, it won't affect me that badly since I am paying off 20 cards and now have 70k avail ? 

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96% to 30% is a significant improvement.  However, creditors don't all have identical critera so you can't assume that all creditors will respond the same.  You're certainly in much better shape at 30% then at 96% regardless of whether or not you qualify for new cards or CLI's.  However, 30K is still a significant amount of debt so stay focused on eliminating that debt before worrying over new cards and CLI's.  You still have one card at 75% and another at 47%.

[surferchris]

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@RM21 wrote:
If you pay down 70k in debt, essentially going from 96% util down to 30% that will probably cause a decent score boost depending on your overall profile. Each card is measured for it's own utilization as well as your overall combined,.if I'm not mistsken.

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Agreed.