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## Question about how Utilization is calculated for scoring

Established Contributor

## Question about how Utilization is calculated for scoring

Ok... so I know Utilization makes up a big chunk of your fico score.  How is that calculated?

Is it percent utilization across all tradelines?

• i.e. you have 10000 in CL, you owe 3000 across all cards so your Utilization is 30 percent)

Or is it utilization for each trade line?

• you have one card with a 500 CL that is at 100 percent utilization and a 5000 CL tradeline that is at 0 then then utilization 50 percent -- i.e. (100 percent + 0 percent)/2 )

Started Over Again after Cap1 Death Penalty:
06/15/2019:
03/02/2021:
04/06/2021:
05/28/2021:
Lesson Learned: DON'T POKE THE BEAR!!! THE BEAR WILL WIN!!!
Message 1 of 6
5 REPLIES 5
Senior Contributor

## Re: Question about how Utilization is calculated for scoring

Fico scores util for both aggregate and individual -- though aggregate tends to have a greater effect.

Aggregate:

(Total Balance Across All Cards / Total Credit Limit Across All Cards) * 100

Individual:

(Individual Card Balance / Individual Card Limit) * 100

Utilization Thresholds for scoring (red is too high) - both aggregate and individual:

88.9%, 68.9%, 48.9%, 28.9%, 8.9%

Best practice for scoring purposes is to keep aggregate below 8.9% and individual below 28.9%.

Number of cards reporting a balance is also a thing that affects scoring --- 1/3 or less of all cards with a balance is ideal.

Personal Aphorism:"Forget What You Feel, Remember What You Deserve"
Starting FICO 8s | 09/2017: EX 641 ✦ EQ 634 ✦ TU 647
Current FICO 8s | 04/2022: EX 796 ✦ EQ 793 ✦ TU 790
Current FICO 9s | 04/2022: EX 790 ✦ EQ 788 ✦ TU 782
2022 Goal Score | 800s

My AAoA:
4.6 years not incl. AU / 4.9 years incl. AU
My AoOA: 9.2 years not incl. AU / 11.2 years incl. AU
Inquiries: EX 0/12 ✦ EQ 0/12 ✦ TU 0/12
Report Status: Clean
Garden Status:

Without patience, we will learn less in life. We will see less. We will feel less. We will hear less. Ironically, rush and more usually mean less.
Message 2 of 6
Established Contributor

## Re: Question about how Utilization is calculated for scoring

Excellent explanation!   Thank you!

Do closed cards with balances reporting (and payments being made -- not charged off) count just the same as open cards?

Again, thank you for such an easy to understand answer!

Started Over Again after Cap1 Death Penalty:
06/15/2019:
03/02/2021:
04/06/2021:
05/28/2021:
Lesson Learned: DON'T POKE THE BEAR!!! THE BEAR WILL WIN!!!
Message 3 of 6
Senior Contributor

## Re: Question about how Utilization is calculated for scoring

@designated_knitter wrote:

Excellent explanation!   Thank you!

Do closed cards with balances reporting (and payments being made -- not charged off) count just the same as open cards?

Again, thank you for such an easy to understand answer!

You're welcome!

Yes.  Closed cards with a balance count also (and I believe their credit limits count, so util will would be calculated the same as an open card).

As for charge-offs with a balance (just as an FYI)  - they count as over 100% util because their credit limit is \$0.

Personal Aphorism:"Forget What You Feel, Remember What You Deserve"
Starting FICO 8s | 09/2017: EX 641 ✦ EQ 634 ✦ TU 647
Current FICO 8s | 04/2022: EX 796 ✦ EQ 793 ✦ TU 790
Current FICO 9s | 04/2022: EX 790 ✦ EQ 788 ✦ TU 782
2022 Goal Score | 800s

My AAoA:
4.6 years not incl. AU / 4.9 years incl. AU
My AoOA: 9.2 years not incl. AU / 11.2 years incl. AU
Inquiries: EX 0/12 ✦ EQ 0/12 ✦ TU 0/12
Report Status: Clean
Garden Status:

Without patience, we will learn less in life. We will see less. We will feel less. We will hear less. Ironically, rush and more usually mean less.
Message 4 of 6
Established Contributor

## Re: Question about how Utilization is calculated for scoring

Once again, thank you!  If you aren't already and are looking for a career change, might I suggest becoming a math teacher!

Cheers!

Started Over Again after Cap1 Death Penalty:
06/15/2019:
03/02/2021:
04/06/2021:
05/28/2021:
Lesson Learned: DON'T POKE THE BEAR!!! THE BEAR WILL WIN!!!
Message 5 of 6
Senior Contributor

## Re: Question about how Utilization is calculated for scoring

@designated_knitter wrote:

Once again, thank you!  If you aren't already and are looking for a career change, might I suggest becoming a math teacher!

Cheers!

LMAO -- thanks but no.  Math is one of the most difficult things to teach (I tutored my nephew and he's lucky I love him)  -- I think i'd lose my mind before the end of my first school semester!

Personal Aphorism:"Forget What You Feel, Remember What You Deserve"
Starting FICO 8s | 09/2017: EX 641 ✦ EQ 634 ✦ TU 647
Current FICO 8s | 04/2022: EX 796 ✦ EQ 793 ✦ TU 790
Current FICO 9s | 04/2022: EX 790 ✦ EQ 788 ✦ TU 782
2022 Goal Score | 800s

My AAoA:
4.6 years not incl. AU / 4.9 years incl. AU
My AoOA: 9.2 years not incl. AU / 11.2 years incl. AU
Inquiries: EX 0/12 ✦ EQ 0/12 ✦ TU 0/12
Report Status: Clean
Garden Status:

Without patience, we will learn less in life. We will see less. We will feel less. We will hear less. Ironically, rush and more usually mean less.
Message 6 of 6
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