Utilization...

[silly34]

Again... Sorry to keep bring this up, I am sure I've seen it posted before.

I am trying to bring all of my cc balances down to the 30% mark for each card. Now I guess where I'm kinda confused is when lenders (mortgage) look at your credit are they looking at the total balances and limits of all the credit cards as one or individual cards?

Thanks!

[Anonymous]

Lenders (at my bank at least) consider your entire debt portfolio--it is ideal to have total DTI at 30% or less. Also, I believe another poster on here told me once that lenders do not take into consideration debt from installment payments that are less than 11 months from maturity. (Please correct me if I am wrong)

However, I have never purchased a home so maybe someone with more experience can help you out on this one.

[haulingthescoreup]

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@silly34 wrote:
Again... Sorry to keep bring this up, I am sure I've seen it posted before.

I am trying to bring all of my cc balances down to the 30% mark for each card. Now I guess where I'm kinda confused is when lenders (mortgage) look at your credit are they looking at the total balances and limits of all the credit cards as one or individual cards?

Thanks!

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Both--they look at both. They look at your overall utilization, plus the utilization on each card.

It would be possible to have very low balances on 4 cards and 99% on a fifth, and depending on the various cards' CL's, your overall util might be under 30% or whatever, but that one card would stink it all up. And you probably know that 30% is just an intermediate goal, and you'll get another big jump at under 10%. If you have every card under 30%, then of course your overall util will also be under 30%.

I think that it's fused who posts on this. If you click on his name, it will bring up all his posts, but brace yourself, because he seems to be headed for 3000 to join Noah.

[silly34]

Ok thats kinda what I was thinking. 30% is our goal on the big balances and then 9% once we've reached the 30% goal. THANKS!!

[haulingthescoreup]

You're welcome, and good luck in mortgage land! I thought we'd all be living in tents after the recent meltdown, but people still seem to be financing houses. I'll bet lenders are delighted to see people like you come in who are educated about personal credit, have a plan, and are working it.

[Anonymous]

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haulingthescoreup wrote:
You're welcome, and good luck in mortgage land! I thought we'd all be living in tents after the recent meltdown, but people still seem to be financing houses. I'll bet lenders are delighted to see people like you come in who are educated about personal credit, have a plan, and are working it.

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Yes, and they absolutely LOVE it when you come w/ a packet of all your needed info- ie. 3 mos or more of check stubs or verfiication, self pulled credit reports, all your bills and payoffs needed, taxes for the last year or a "tax transcript" for the last year or two- any other doc. of income that you wish to include in the loan app, any other big outstanding pay allocations like child support if you wish to report it(i.e. that you either pay it out or you recieve it) ID cards, SS cards, etc.

This way- you can just "whip out the paperwork" they need and blam boom- on your way to a fast close!!! Also w/ a self pulled CR if you have good FICO's you can rate shop and "you" are in the captain's chair re: fees and what you will and won't accept.

Message Edited by netpanther on 10-10-2007 09:04 PM