0%, 1% ... what's the best utilization for maximizing score

[MizzB]

I paid down my cc utilization to 0% and saw a major score boost (73 points on TU and 50 on EQ). I'm wondering what's the best utilization percentage to show to maximize credit score? Also, if I increase my utilization to 1% how much of a credit score drop will I see.

[haulingthescoreup]

Most of us do better at 1-2% than at 0%. I lost an average of 4 points when I experimented with letting all report $0.

Trying picking one card that is prompt and predictable about its reporting patterns (i.e., Bank of America) and let it report 1% of your total util, while keeping the others at $0. Next month, do the same, but try 2%.

Just let one card report, though.

[MizzB]

Thanks HTSU. I guess I'll try keeping a very low balance on my Capital One card. My scores are still very low and I'm scared to app for a new card. I would love to get in with BofA, but I think that's far down the road for me.

[Anonymous]

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@haulingthescoreup wrote:
Most of us do better at 1-2% than at 0%. I lost an average of 4 points when I experimented with letting all report $0.

Trying picking one card that is prompt and predictable about its reporting patterns (i.e., Bank of America) and let it report 1% of your total util, while keeping the others at $0. Next month, do the same, but try 2%.

Just let one card report, though.

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+1

There is some speculation that, for those in the highest "bucket" (800+ scores), 0% total utilization might be better than 1% in maximizing Fico scores. For the vast majority of us, though, 1% overall utilization will result in a slightly better score than 0% ...

[Anonymous]

MizzB,  apply for a card with BOA, and with your scores they should counter with their 99/500 offer.  I got mine with scores in the low 500s.  It unsecured after about 9 months, and now I have a BOA card.

[Anonymous]

As one of the 800 plus crowd, I can say that in my experience a zero balance on all cc accounts drops my score 3 to 6 points.

When I report a balance on a single account more than zero, but less than 1% I gain back 1 to 3 points.

When I report a balance on a single account more than 1% but less than 8% I gain back the 3 to 6 points previously lost.

When I report a balance on two accounts more than zero but less than 8%, I lose 2 to 3 points.

When I report a balance on three accounts less than 8% I lose 8 to 14 points.

NOTE:  I have an auto loan which means in each case above the total accounts with balance is +1.

[MizzB]

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@Anonymous wrote:
MizzB,  apply for a card with BOA, and with your scores they should counter with their 99/500 offer.  I got mine with scores in the low 500s.  It unsecured after about 9 months, and now I have a BOA card.

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I have three collections that are medical collections that I'm attempting to get removed via the HIPAA process. Do you think that will impact their decision? I thought it might be better to have them removed and then attempt to apply. I've seen so many people on different threads who are in the 600s get rejected by BofA. Hopefully the removal of those collections, will boost my score by 25-35 points and increase my liklihood of obtaining the card.

One last question... .does anyone know if the amount of money you use to apply for a secured card affects there decision? Basically, is applying for a low limit secured card better than a high limit secured card? Thanks

[MizzB]

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@Anonymous wrote:

As one of the 800 plus crowd, I can say that in my experience a zero balance on all cc accounts drops my score 3 to 6 points.

When I report a balance on a single account more than zero, but less than 1% I gain back 1 to 3 points.

When I report a balance on a single account more than 1% but less than 8% I gain back the 3 to 6 points previously lost.

When I report a balance on two accounts more than zero but less than 8%, I lose 2 to 3 points.

When I report a balance on three accounts less than 8% I lose 8 to 14 points.

NOTE:  I have an auto loan which means in each case above the total accounts with balance is +1.

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Thanks for the in depth breakdown. I'm paying bills with my cards now and PIF at the end of the cycle. I'll pay Cap 1 down to 1% until I obtain enough confidence to go for a BofA secured.

[haulingthescoreup]

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MizzB wrote:

...I have three collections that are medical collections that I'm attempting to get removed via the HIPAA process. Do you think that will impact their decision? I thought it might be better to have them removed and then attempt to apply. I've seen so many people on different threads who are in the 600s get rejected by BofA. Hopefully the removal of those collections, will boost my score by 25-35 points and increase my liklihood of obtaining the card.

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Absolutely, wait until the collections are removed and no longer show on any reports before applying. I'm always amazed when someone posts that a creditor agreed to remove a negative, and they're waiting for it to go through, and they go ahead and apply for something anyway.

You will improve your chances of approval by waiting, and you'll also get better terms.

[MizzB]

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@haulingthescoreup wrote:

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@MizzB wrote:

...I have three collections that are medical collections that I'm attempting to get removed via the HIPAA process. Do you think that will impact their decision? I thought it might be better to have them removed and then attempt to apply. I've seen so many people on different threads who are in the 600s get rejected by BofA. Hopefully the removal of those collections, will boost my score by 25-35 points and increase my liklihood of obtaining the card.

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Absolutely, wait until the collections are removed and no longer show on any reports before applying. I'm always amazed when someone posts that a creditor agreed to remove a negative, and they're waiting for it to go through, and they go ahead and apply for something anyway.

You will improve your chances of approval by waiting, and you'll also get better terms.

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Thanks for the feedback. I think I'll give it a try down the line when my scores a bit higeher and I feel a bit more confident.