Card balances

[HeavenOhio]

@armywifelong03, definitely make sure you're paying more than the minimum on all cards. Two to three times the minimum is good.

@Anonymous, there are three components that go into the utilization portion of one's score:

• Overall utilization
• Individual card utilization
• Number/percentage of cards reporting positive balances

Overall utilization is the most important factor, and the good news is that all payment approaches address it. Oftentimes, when one is trying to improve scores fairly quickly, the choice between individual card utilization and number/percentage of cards reporting positive balances is based on which one is more achievable. But when cards are maxed or nearly so, it's important to get those balances down. Maxed is a huge score hit, and high individual card balances have the potential to invite adverse action (credit limit decreases or card closures).

[Anonymous]

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@HeavenOhio wrote:

@armywifelong03... Overall utilization is the most important factor ... But when cards are maxed or nearly so, it's important to get those balances down. Maxed is a huge score hit ...

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Thank you for the thoughtful reply. Question: what is considered "maxed"? intuitively it seems it would be somewhere above the highest scoring threshold 90% -- are you saying "maxed" is somewhat lower than this? Or are you just offering a general safety caveat like "Careful, child, the stove is hot!" 

[Anonymous]

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@Anonymous wrote:

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@HeavenOhio wrote:

@armywifelong03... Overall utilization is the most important factor ... But when cards are maxed or nearly so, it's important to get those balances down. Maxed is a huge score hit ...

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Thank you for the thoughtful reply. Question: what is considered "maxed"? intuitively it seems it would be somewhere above the highest scoring threshold 90% -- are you saying "maxed" is somewhat lower than this? Or are you just offering a general safety caveat like "Careful, child, the stove is hot!" 

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For purposes of scoring, >90% UTI would be considered maxed out AFAIK. 

[HeavenOhio]

To be precise, to avoid being maxed, you balance should be at 88.9% of the card's limit or below. That's because FICO rounds all fractions up, e.g. 90.00000001% becomes 91%. Some credit monitoring services get this wrong and round fractions down. Watch out for that if you're at or near a threshold.

Also, people who are maxed are frequently paying interest. To keep the next month's interest charge from bumping you back over 88.9%, aim for 86–87%.

[kilroy8]

I think the "maxed" cutoff is 84.9%.

Search through some of the posts by ABCD(some number) and you should find DP's.

[Trudy]

Let the experts tell you for sure... but I noticed a significant MTG score increase for EQ and TU when only 1 card reported.  I've been below 5% total UTL for quite some time and at 1% on 5/8 and 6/8.  There were no other changes from these dates other than the # of cards reporting and a $2 balance. 

5/8 - 1% UTL for 3 cards reporting; total outstanding $148.  

6/8 - 1% UTL for 1 card reporting; total outstanding $150. 

My MTG scores seem a lot more sensative to the # of revolving accounts reporting.  Prior to 5/8 (on 4/16) by EQ and TU scores were higher than my 5/8 scores even though my outstanding card balance and utlization was higher (2 cards of 8 reporting, 2% UTL) 

Seems everything mentioned previously is absolutely important and makes sense regarding your next steps.  Just thought I'd add my experience.  I've learned a great deal from the many guru's here.  With my scores being okay I started playing with some things to see how it would impact my scores.  Stopped playing once my MTG scores were over 760 and re-finance my home before anything else could change   You know, since they're so sensative and all....