Re: Best utilization

How2increase · ‎03-26-2017

Hi everyone, I am trying to improve my scores in order to qualify for a mortgage. However, I have 2 credit cards (my only) and both are at 100% utilization. What's the magic percent to have the biggest impact on my fico score? 20% or 10%? In your experience how much did you see your score go up after paying down a significant amount of credit card debt? I need at least 51 points to qualify for the best rate.

Jan 2012 TU 517 EX(fako) 524 EQ 470
Current score LENDER PULL TU 652 EX 641 EQ 617
Yayy we made it!!!

Isacking97 · ‎03-26-2017

@How2increase wrote:
Hi everyone, I am trying to improve my scores in order to qualify for a mortgage. However, I have 2 credit cards (my only) and both are at 100% utilization. What's the magic percent to have the biggest impact on my fico score? 20% or 10%? In your experience how much did you see your score go up after paying down a significant amount of credit card debt? I need at least 51 points to qualify for the best rate.

under 9%, It looks bad to have a uti. so high, I m suprised they haven't closed your account for risky usage!!!!!

Starting Score:EX: 713 EQ: 698

Anonymous · ‎03-26-2017

@How2increase wrote:
Hi everyone, I am trying to improve my scores in order to qualify for a mortgage. However, I have 2 credit cards (my only) and both are at 100% utilization. What's the magic percent to have the biggest impact on my fico score? 20% or 10%? In your experience how much did you see your score go up after paying down a significant amount of credit card debt? I need at least 51 points to qualify for the best rate.

Ideally 10%. There's no set amount you'll see your score jump when you cross the magic thresholds, but, if you watch closely, you can see increases the signify changes in how the algorithm or credit analyst is interpreting your file once you get under 20% or 10%. I've noticed jumps in scores once I've moved under both those thresholds, but really it's based on your on individual, unique credit profile as to how much they might move. At 100% you're a long way off. There's a couple different ways to change utilization. You can pay down debt or you can increase your overall credit. Although it can be difficult to get your overall credit up when your utilization is high, so that can be a bit of a catch-22 situation.

HeavenOhio · ‎03-26-2017

For full optimization of the utilization portion of your score, have one card report a statement balance of zero, and have the other report a tiny balance of $10 or so. Make sure that the tiny balance is at least $5 because some companies will forgive small balances and report zero. Also make sure that the balance is on a major card rather than a store card and that it's a card that's yours rather than a card on which you're an authorized user.

There are some nuances to this. It's easier if the card reporting the balance is something other than a Chase card, for instance. And US Bank reports on the first of the month rather than at statement time. If you could post which cards you have and their limits, someone here would likely know if there are any other caveats that might need to be considered.

NRB525 · ‎03-26-2017

@How2increase wrote:
Hi everyone, I am trying to improve my scores in order to qualify for a mortgage. However, I have 2 credit cards (my only) and both are at 100% utilization. What's the magic percent to have the biggest impact on my fico score? 20% or 10%? In your experience how much did you see your score go up after paying down a significant amount of credit card debt? I need at least 51 points to qualify for the best rate.

Which cards do you have, what are their limits and what is the statement balance?

The approach to improve utilization depends on what your existing profile looks like.

Are there any baddies in your file? Any late payments ever? Chargeoffs? That has some impact on how much improvement you could expect.

High Bal Jan 2009 $116k on $146k limits 80% Util.
Oct 2014 $46k on $127k 36% util EQ 722 TU 727 EX 727
April 2018 $18k on $344k 5% util EQ 806 TU 810 EX 812
Jan 2019 $7.6k on $360k EQ 832 TU 839 EX 831
March 2021 $33k on $312k EQ 796 TU 798 EX 801
May 2021 Paid all Installments and Mortgages, one new Mortgage EQ 761 TY 774 EX 777
April 2022 EQ=811 TU=807 EX=805 - TU VS 3.0 765

SouthJamaica · ‎03-26-2017

@How2increase wrote:
Hi everyone, I am trying to improve my scores in order to qualify for a mortgage. However, I have 2 credit cards (my only) and both are at 100% utilization. What's the magic percent to have the biggest impact on my fico score? 20% or 10%? In your experience how much did you see your score go up after paying down a significant amount of credit card debt? I need at least 51 points to qualify for the best rate.

The best thing you could do with the 2 cards is to let one report a zero balance and the other report less than 10%.