I would recommend reading the below from ABCD2199
The Truth about Credit Card Utilization
My 11 Rules to Credit Rebuilding
FICO Score: What to pay down first?
@tayloreat713 wrote:Can someone share with me when you pay down your credit balances isn't there a there a breakdown of what you can expect your scores to change. For example, paying down your credit card to a 30% utilization rate is better than paying your card down to a 70% utilization rate. At what point should you except your score to change? I saw it on a post before but can't find it.
Personally I'm not so sure we know all the thresholds, but certain thresholds are well known.
1. Individual account revolving utilization
Utilization is based on reported balance, which in most but not all accounts is statement balance. The most important breakpoint is 30%. 30% or higher causes significant point loss. Optimum to keep at 28% or less to avoid rounding up.
2. Aggregate revolving utilization
Utilization is based on reported balances, which in most but not all accounts is statement balance. The most important breakpoint is 10%. Optimum to keep at 8.9% or less, but more points will be gained by keeping it as low as possible, so long as there is at least one account reporting a small balance.
3. Aggregate installment utilization
The total of all open installment loan balances divided by the total original loan amounts of those loans. A significant factor in FICO 8 and 9, less so in earlier scoring models. Most important breakpoint is 10%. Optimum to keep at 9% or less.
