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CC Utilization improvement and Mortgage Score

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Established Member

CC Utilization improvement and Mortgage Score

I app'd for a VA loan last week and my middle score was at 617, so my LO told me to take the money I saved for closing (~$4000) and put most of it towards paying down my CC's, so I tried to get as many past their closest threshold as possible, aiming to have all of them <49% even accounting for the upcoming interest. I did that and now I am curious if you guys can give me an estimate of how much of a score bump I should see. I can't stretch any further to get that last few percent to get my aggregate down to <29%.

 

My only negatives are:

- CH. 7 BK: Discharged in July 2016

- 3 missed payments on student loan:  Mid 2017 (ZERO missed or late payments on anything since). Total balance remaining: $22k

 

I have a car loan with $11.5k remaining. Been paying on it for almost 2 years and zero missed payments.

 

CC Utilization before/at time of inquiry:

Aggregate UL: ~62%

Bass Pro

CL: 1000, Balance: 150, UL: 15%

Best Buy

CL: 2000, Balance: 1862, UL: 99%

Credit One

CL: 2000, Balance: 1852, UL: 99%

Genesis (line of credit for a mattress that apppears as a CC)

CL 2000, Balance: 250, UL: 13%

Ollo

CL: 600, Balance: 506, UL: 85%

Overstock

CL: 800, Balance: 375, UL: 47%

Cap One Platinum:

CL: 500, Balance: 388, 78%

Cap One Quicksilver

CL: 750, Balance: 798, UL: 80%

Target:

CL: 300, Balance 258, UL: 86%

 

Since then, I have paid them down as follows:

Aggregate UL: ~32%

Bass Pro

CL: 1000, Balance: 80, UL: 8%

Best Buy

CL: 2000, Balane: 940, UL: 47%

Credit One

CL: 2000, Balance: 940, UL: 47%

Genesis (line of credit for a mattress that apppears as a CC)

CL 2000, Balance: 220, UL: 11%

Ollo

CL: 600, Balance: 280, UL: 47%

Overstock

CL: 800, Balance: 220, UL: 28%

Cap One Platinum:

CL: 500, Balance: 0, UL: 0%

Cap One Quicksilver

CL: 750, Balance 350, UL: 47%

Target:

CL: 300, Balance 115, UL: 39%

Message 1 of 10
9 REPLIES 9
Community Leader
Super Contributor

Re: CC Utilization improvement and Mortgage Score

First, congrats on reducing your UT and because you crossed a threshold, you should see a nice little bump as long as there’s nothing negative in your reports. 

 

If you can squeeze out any more money, you can also get a nice little bump by having more cards reporting a $0 balance. And, this also decreases your DTI ratio. 

 

So, if you could pay off Bass Pro, Target, Genesis, Overstock, Ollo, and QS  — one at a time in this order, that would be great! Now I’m not saying all at once, but trying to get the smaller ones paid off will boost your scores. 

 

GL2U

REVISED GOAL: Garden ‘til Dec 2020 — 0 inquiries

Previous Goal: Garden til APR 2020 (extended) and
800 Club (accomplished)


DEC 2019: EX 816, TU 820, EQ 810
DEC 2018: EX 777, TU 783, EQ 799
DEC 2017: EX 775, TU 778, EQ 769

|| NFCU CashRewards $30K || AmX Cash Magnet $30K || Discover IT $22.2K || Macy's $20K || NFCU CLOC $15K || NFCU Platinum $12.5K || AmX ED $11.5K || CitiCostco $7K || CitiDC $6.3K ||
Message 2 of 10
Established Member

Re: CC Utilization improvement and Mortgage Score

Thank you. Do you know if there will be a significant increase if i paid off my bass pro card right now? With as many cards as I have, will 2 reporting at a 0 balance be much better than 1 reporting 0 and the next lowest reporting at <9%? It seems to me, based on what I've read here, that the amount of cards with a zero balance is significant only when it is either less than half or  just  all but one.

Message 3 of 10
Community Leader
Super Contributor

Re: CC Utilization improvement and Mortgage Score


@rc_it wrote:

Thank you. Do you know if there will be a significant increase if i paid off my bass pro card right now? With as many cards as I have, will 2 reporting at a 0 balance be much better than 1 reporting 0 and the next lowest reporting at <9%? It seems to me, based on what I've read here, that the amount of cards with a zero balance is significant only when it is either less than half or  just  all but one.


This is true. That's why I say depending on your funds, do one at a time. Each one that gets to $0 will increase your score--not significantly, but every point increase helps as you get credit cards to 0 one-by-one.

REVISED GOAL: Garden ‘til Dec 2020 — 0 inquiries

Previous Goal: Garden til APR 2020 (extended) and
800 Club (accomplished)


DEC 2019: EX 816, TU 820, EQ 810
DEC 2018: EX 777, TU 783, EQ 799
DEC 2017: EX 775, TU 778, EQ 769

|| NFCU CashRewards $30K || AmX Cash Magnet $30K || Discover IT $22.2K || Macy's $20K || NFCU CLOC $15K || NFCU Platinum $12.5K || AmX ED $11.5K || CitiCostco $7K || CitiDC $6.3K ||
Message 4 of 10
Established Member

Re: CC Utilization improvement and Mortgage Score

So I went ahead and paid off Bass Pro because the simulator on Creditwise told me I'd see a 24 point increase if I paid $150 towards my CC debt (BPS last reported at $149) and it should be the next to report in a couple days.

 

This is actually getting addicting. Paying off my CC's and watching my score go up (theoretically, at least for the next couple weeks) is nearly as fun spending that money on the crap that put me into debt. Especially now that I actually have cards with a $0 balance for the first time in a very long time and it's not because they are brand new.

Message 5 of 10
Community Leader
Super Contributor

Re: CC Utilization improvement and Mortgage Score


@rc_it wrote:

So I went ahead and paid off Bass Pro because the simulator on Creditwise told me I'd see a 24 point increase if I paid $150 towards my CC debt (BPS last reported at $149) and it should be the next to report in a couple days.

 

This is actually getting addicting. Paying off my CC's and watching my score go up (theoretically, at least for the next couple weeks) is nearly as fun spending that money on the crap that put me into debt. Especially now that I actually have cards with a $0 balance for the first time in a very long time and it's not because they are brand new.


Way to Go on paying off a CC!  Yep, it is both addictive and exciting.

 

Now simulators are not 100% accurate, it’s a tool to give one something to play around with. But definitely keep us posted on the data points because now we’re invested in your progress. 

REVISED GOAL: Garden ‘til Dec 2020 — 0 inquiries

Previous Goal: Garden til APR 2020 (extended) and
800 Club (accomplished)


DEC 2019: EX 816, TU 820, EQ 810
DEC 2018: EX 777, TU 783, EQ 799
DEC 2017: EX 775, TU 778, EQ 769

|| NFCU CashRewards $30K || AmX Cash Magnet $30K || Discover IT $22.2K || Macy's $20K || NFCU CLOC $15K || NFCU Platinum $12.5K || AmX ED $11.5K || CitiCostco $7K || CitiDC $6.3K ||
Message 6 of 10
Established Member

Re: CC Utilization improvement and Mortgage Score


@CreditInspired wrote:

Now simulators are not 100% accurate, it’s a tool to give one something to play around with. But definitely keep us posted on the data points because now we’re invested in your progress. 


Oh, for sure. I know it's just an estimate. But it at least gave me enough confidence that paying it off would have a significant immediate impact to make it worthwhile rather than saving that $80. Had it only told me I'd get a 5 or even 10 point boost, I likely would have not paid it because I could also use that money right now to help with my home purchase.

Message 7 of 10
Established Member

Re: CC Utilization improvement and Mortgage Score

Not being satisfied with the answers given to me by my "current LO" (I have no vested interest in him anyways), i decided to reach out to Veterans United to hopefully get some clarification. I also reached out to them because I had to hear from this board about a "repid rescore" rather than the lenders I'd been dealing with. Veterans United mentioned it without my even asking so I went ahead and applied and their estimator told me my middle score should go up to 645 based on what I've paid off so far. this not only gets me over the 620 hump which would have given me a 4.5% APR, it puts me at the next score tier of 640 which is 4.25%. I am now waiting on some current balance letters from a few creditors so they can do the rapid rescore on those, then wait for the other couple to naturally report (due to the cost of the RR, apparently).

Message 8 of 10
Established Contributor

Re: CC Utilization improvement and Mortgage Score

Awesome!! That's a huge difference in utilization, good job.

FICO8: Low 700s. FICO9: Mid 700s. Goal: 800 club
Message 9 of 10
Established Member

Re: CC Utilization improvement and Mortgage Score

Update:

 

My "current balance letter" from Credit One did not come in until Saturday, so Veterans United sent the rescore in on Monday. I finally got updates from all the free credit monitoring systems that Capital One reported my Bass Pro card being paid off, but none of them bothered to updated my score. I reached out to Veterans United and she informed me that my EX score was at 643 and that the rescores had already went through! She went ahead and pulled my report again and all three scores were 626, 643, 646 even though not all my CC's have reported this month! My current reported CC balances are as follows (noting that in the next couple weeks balances and UL% will keep going down)

 

 

Aggregate UL: ~39%

Bass Pro

CL: 1000, Balance: 0, UL: 0%

Best Buy

CL: 2000, Balance: 940, UL: 47%

Credit One

CL: 2000, Balance: 940, UL: 47%

Genesis (line of credit for a mattress that apppears as a CC)

CL 2000, Balance: 259, UL: 13%

Ollo

CL: 600, Balance: 506, UL: 84%

Overstock

CL: 800, Balance: 375, UL: 47%

Cap One Platinum:

CL: 500, Balance: 0, UL: 0%

Cap One Quicksilver

CL: 750, Balance 698, UL: 93%

Target:

CL: 300, Balance 155, UL: 52%

Message 10 of 10
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