practical value of a huge credit limit?

[Anonymous]

Sounds like the test indeed is underway then, about 2 weeks away from a result!  Do you have a means (like CCT) to pull your 3B scores the day after you know that account reports?  If the $50k credit line is not included into your overall utilization, you should see your scores drop maybe 14-22 points.  If it is, there should be no change at all.  I'm looking forward to seeing what happens with this.

[JLK93]

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@Anonymous wrote:

 Maybe the breakpoint is also CRA dependent, right?

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 I think this idea stems from a time then myFICO sold EQ04 and TU98.

[JLK93]

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@Anonymous wrote:

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The general feeling I am getting is that the breakpoint could be anywhere between 35k and 50k, with a greater likelihood of 50 than 35.  But without test data we just don't know.  I think Credit Check Total would be really nice as the testing tool since it would give us the ability to distinguish between the different CRAs, all pulled at the same instant.  Maybe the breakpoint is also CRA dependent, right?

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I reviewed my notes. A while back someone reported testing a 100K card. He said that it was included in utilization by FICO 8. If it turns out that this was not a aberration, it may be impossible to determine the FICO 8 cuttoff. It is possible that there is not a cutoff point for FICO 8. 

I have a 51.5K card I can test in about a month.

My testing showed that 45.5K was included in utilization by FICO 04, 8 and 9 but excluded by FICO 98.

[tacpoly]

I have Fico 3B monitoring with alerts.  When a significant balance reports on my credit card with >$50K limit, my scores drop.  For example, my cc reported a $7900 balance this month (14% util for that cc vs $865 last month, 1% cc util); my Experian Fico 8 score immediately dropped 10 points, my Transunion score dropped 5 points, no change with Equifax*.  The reporting of that balance was the only change.  This suggests that my 50+K limit cc utilization is being reported.  I have 2 other cc lines over and 2 lines below 30K. 

* I wouldn't conclude anything from Eq scores not changing.  All my credit reports are frozen and Eq seems to be more sensitive to this than the other credit reporting agencies.  3B monitoring only gets sporadic score updates from Eq.  Whether this is because of their algorithm or Fico not having access, I don't know. 

[Anonymous]

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@tacpoly wrote:

I have Fico 3B monitoring with alerts.  When a significant balance reports on my credit card with >$50K limit, my scores drop.  For example, my cc reported a $7900 balance this month (14% util for that cc vs $865 last month, 1% cc util); my Experian Fico 8 score immediately dropped 10 points, my Transunion score dropped 5 points, no change with Equifax*.  The reporting of that balance was the only change.  This suggests that my 50+K limit cc utilization is being reported.  I have 2 other cc lines over and 2 lines below 30K. 

* I wouldn't conclude anything from Eq scores not changing.  All my credit reports are frozen and Eq seems to be more sensitive to this than the other credit reporting agencies.  3B monitoring only gets sporadic score updates from Eq.  Whether this is because of their algorithm or Fico not having access, I don't know. 

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This is interesting and curious information to me.

What are the balances on your other 4 revolvers?  If they are 1%-9% I find this quite odd.  I know a lot of people have reported bringing up their utilization on one card and seeing no adverse impact on their scores (assuming all their other cards are at zero or low balances) when they've hit 30%, even 50% utilization.  I'm surprised that 14% would matter on one card.  That makes me wonder if there's something else built into the algorithm regarding monster limit cards... perhaps that the utilization isn't counted up until a certain point, then possibly it is?  This makes this topic all the more confusing.

[JLK93]

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@Anonymous wrote:

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@tacpoly wrote:

I have Fico 3B monitoring with alerts.  When a significant balance reports on my credit card with >$50K limit, my scores drop.  For example, my cc reported a $7900 balance this month (14% util for that cc vs $865 last month, 1% cc util); my Experian Fico 8 score immediately dropped 10 points, my Transunion score dropped 5 points, no change with Equifax*.  The reporting of that balance was the only change.  This suggests that my 50+K limit cc utilization is being reported.  I have 2 other cc lines over and 2 lines below 30K. 

* I wouldn't conclude anything from Eq scores not changing.  All my credit reports are frozen and Eq seems to be more sensitive to this than the other credit reporting agencies.  3B monitoring only gets sporadic score updates from Eq.  Whether this is because of their algorithm or Fico not having access, I don't know. 

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This is interesting and curious information to me.

What are the balances on your other 4 revolvers?  If they are 1%-9% I find this quite odd.  I know a lot of people have reported bringing up their utilization on one card and seeing no adverse impact on their scores (assuming all their other cards are at zero or low balances) when they've hit 30%, even 50% utilization.  I'm surprised that 14% would matter on one card.  That makes me wonder if there's something else built into the algorithm regarding monster limit cards... perhaps that the utilization isn't counted up until a certain point, then possibly it is?  This makes this topic all the more confusing.

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A couple of years ago, someone suggested that for CCs with limits >50K, it was possible that only balances over a certain level were included in utilization by FICO 8.

There was also a suggestion that CCs with >50K limits were factored in overall utilization, but not individual card utilization by FICO 8.

I have no opinion.

I don't think that anyone has tested these theories. This kind of testing would be a bit more involved.

[tacpoly]

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@Anonymous wrote:

This is interesting and curious information to me.

What are the balances on your other 4 revolvers?  If they are 1%-9% I find this quite odd.  I know a lot of people have reported bringing up their utilization on one card and seeing no adverse impact on their scores (assuming all their other cards are at zero or low balances) when they've hit 30%, even 50% utilization.  I'm surprised that 14% would matter on one card.  That makes me wonder if there's something else built into the algorithm regarding monster limit cards... perhaps that the utilization isn't counted up until a certain point, then possibly it is?  This makes this topic all the more confusing.

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I have 1 card with a 20K limit reporting $7700, all others are 0.  Having the alerts, I find there's a lot of bounce to credit scores based on reporting activity:  down when a large balance reports, back up when they get paid (don't carry balance).  I generally don't pay attention to the fluctuations -- except now with this discussion.  The cards get used all the time, but heavier now as I'm arranging lots of travel.  I'll have another 7-10K reporting next month so overall utilization won't change much. 

[newhis]

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@tacpoly wrote:

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@Anonymous wrote:

This is interesting and curious information to me.

What are the balances on your other 4 revolvers?  If they are 1%-9% I find this quite odd.  I know a lot of people have reported bringing up their utilization on one card and seeing no adverse impact on their scores (assuming all their other cards are at zero or low balances) when they've hit 30%, even 50% utilization.  I'm surprised that 14% would matter on one card.  That makes me wonder if there's something else built into the algorithm regarding monster limit cards... perhaps that the utilization isn't counted up until a certain point, then possibly it is?  This makes this topic all the more confusing.

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I have 1 card with a 20K limit reporting $7700, all others are 0.  Having the alerts, I find there's a lot of bounce to credit scores based on reporting activity:  down when a large balance reports, back up when they get paid (don't carry balance).  I generally don't pay attention to the fluctuations -- except now with this discussion.  The cards get used all the time, but heavier now as I'm arranging lots of travel.  I'll have another 7-10K reporting next month so overall utilization won't change much. 

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Could it be that some profiles are more 'solid' than others?

I also see several points up/down if I pay a card to $0 or it changes from $0 to balance. Util hovers around 5%. I think my profile is not as solid as others.

Starting this month I'll add a SSL, I don't know if that will help to have a more solid profile. I don't plan to app for anything for the next 6 months.

I see people with scores that stay the same for several months, mine always go up/down (FICO TU via Discover).

Maybe other people let the same card report the same balance every month.

I guess to have the same score for several months is to report the same cards, the same balance, each month. At least for some. Others are fine with letting 1 card report even if the card goes over 10-30% if the other cards are at $0.

Maybe in the future I'll test reporting only 1 card and changing the amount up/down to see if that changes my score.

[JLK93]

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@tacpoly wrote:

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@Anonymous wrote:

This is interesting and curious information to me.

What are the balances on your other 4 revolvers?  If they are 1%-9% I find this quite odd.  I know a lot of people have reported bringing up their utilization on one card and seeing no adverse impact on their scores (assuming all their other cards are at zero or low balances) when they've hit 30%, even 50% utilization.  I'm surprised that 14% would matter on one card.  That makes me wonder if there's something else built into the algorithm regarding monster limit cards... perhaps that the utilization isn't counted up until a certain point, then possibly it is?  This makes this topic all the more confusing.

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I have 1 card with a 20K limit reporting $7700, all others are 0.  Having the alerts, I find there's a lot of bounce to credit scores based on reporting activity:  down when a large balance reports, back up when they get paid (don't carry balance).  I generally don't pay attention to the fluctuations -- except now with this discussion.  The cards get used all the time, but heavier now as I'm arranging lots of travel.  I'll have another 7-10K reporting next month so overall utilization won't change much. 

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If I understand correctly, you went from <1% overall utilization to approximately 3% overall utilization.

[Thomas_Thumb]

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@tacpoly wrote:

I have Fico 3B monitoring with alerts.  When a significant balance reports on my credit card with >$50K limit, my scores drop.  For example, my cc reported a $7900 balance this month (14% util for that cc vs $865 last month, 1% cc util); my Experian Fico 8 score immediately dropped 10 points, my Transunion score dropped 5 points, no change with Equifax*.  The reporting of that balance was the only change.  This suggests that my 50+K limit cc utilization is being reported.  I have 2 other cc lines over and 2 lines below 30K. 

* I wouldn't conclude anything from Eq scores not changing.  All my credit reports are frozen and Eq seems to be more sensitive to this than the other credit reporting agencies.  3B monitoring only gets sporadic score updates from Eq.  Whether this is because of their algorithm or Fico not having access, I don't know. 

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Outlier data is an interesting challenge - the impact of high limit credit cards is not well documented and hypothesis on their treatment by Fico scoring models needs tweaking.

As a starting point assume that $50k and over revolving CCs are treated differently in Fico 08, that over $35k CCs are treated differently in Fico 98 and either over $50k or $35k cards are treated differently in Fico 04. Some possibilities that come to mind are:

a) The "high limit" cards are  not included in aggregate utilization nor are they looked at on an individual basis.

b) The high limit cards are not included in aggregate utilization but are looked at on an individual utilization basis.

 -1) option #1 if looked at individually, card UT% may be evaluated according to Ag UT% thresholds, thus impact on score over 9%..

 -2) Option #2 if looked at individually, card UT% treated no differently than lower limit cards that are part of the aggregate. In this case harder to explain drop in score relative to utilization since card only at 14%. Perhaps something else in play such as an increase in # open accounts reporting a balance.

FWIW - it might be helpful to collect data in a formatted manner such as the below (before scores followed by after scores) for subsequent comparson among posts. Not everyone will be able to isolate a specific high limit only event but, results may still provide some insight.

Side note: If a card has not been used for over 3 months, it may have been tagged as inactive. There are some posts that suggest a card that has been inactive 6 months or more may cause a score drop when 1st re-activated. This has not been adequately validated but, would be worth noting if the reported data includes such a card.