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I'm a little confused on how credit utilization works. A lot of said that a co account goes against a your utilization, and if you pay it off you may see a small boost. But, when I login to Experian (I realize these aren't real scores) it doesn't include these cards into the utilization. Because mine says 3%, but still have a few co cards to pay off. Can anybody explain?
Easiest way is this.
List in order.
Creditor name/ Credit Line/ Balance
Then we can see whats up. You have individual card util and then aggregate (overall) util that makes it all up. If you follow All Zero Except One (AZEO) thats when you get the best bang for your buck.
@Cjethompson2017 wrote:I'm a little confused on how credit utilization works. A lot of said that a co account goes against a your utilization, and if you pay it off you may see a small boost. But, when I login to Experian (I realize these aren't real scores) it doesn't include these cards into the utilization. Because mine says 3%, but still have a few co cards to pay off. Can anybody explain?
The Credit Monitoring Sites show your OPEN revolving Util, which does not count past due balances of COs. The FICO algos behind the scenes count these COs against your Util. In fact, they count them as "maxxed out" - we don't exactly know the percentage (tried doing testing as I paid them off).
So, it is smart FICOing to keep open Util low and practice AZEO, but you have to address all the past due CO balances. Only when you settle or pay off those CO past due balances will you see the score benefits from Util. BTW - in my testing I did not see any benefit between AZE2 and AZEO when I settled my COs. YMMV as there are many factors to a credit profile.
JOINED 4/2020
FICO 8 = 582, 620, 589 / Mortgage = 633, 526, 581
CURRENT PEAK *Thanks to the MF Community!
FICO 8 = 715, 711, 720 / Mortgage = 688, 696, 681
Mine:
Comenity/VS: $0/$190
Comenity/Toyota: $0/$250
Comenity/NY&Co: $0/$200
CapOne CO: $451
CreditOne CO: Shows $0
Authorized Signer on Kohl’s: $30/$300
Authorized Signer Discover: $20/$200
Husbands:
Kohls: $30/$300
Discover: $20/$200
Citi CO: $1147
Chase CO: $4560, but settled so should show $0 anytime now
All other closed accounts show $0.
@TheKid2 I don't know all the lingo yet. What does AZE2 and AZEO and YMMV mean? Lol. I am trying to get all these paid off here shortly. It'll be good to get this stuff off my plate.
@Cjethompson2017 wrote:@TheKid2 I don't know all the lingo yet. What does AZE2 and AZEO and YMMV mean? Lol. I am trying to get all these paid off here shortly. It'll be good to get this stuff off my plate.
AZEO = All Zero Except One
AZE2 = All Zero Except 2
Refers to the practice of letting only one or two cards report a statement balance, while every other card reports $0 for a FICO score boost.
YMMV when it comes to your CO accounts and if you pay them off. Like it was stated before, you may see a small increase when you pay off CO accounts. I had no active revolving accounts reporting a balance but when I paid off my Target TD CO which was 835$, I gained 20 points which dropped the combined util % from 28% to 17%. You may or may not get the same results but taking care of CO accounts will help regardless.
What does YMMV mean?? Dang It. I feel old. 😂
@Cjethompson2017 wrote:What does YMMV mean?? Dang It. I feel old. 😂
YMMV = Your Mileage May Vary
Here's a good resource for you: