Credit Utilization

[Anonymous]

I have 10 credit cards, 4 with 0 balance and 6 with less than 50% balance. My total Credit Util ratio is 27%. I have recently used a 0% offer on one card and it has 95% balance now. My total Credit is at 31%. Please advise if this can cause a big drop in my score. I am at 720 Equifax now.

[GFer]

Seems to me any card with that of high of utilization would cause a drop. How much, would depend on other factors of your report.

The thing is, with creditors getting so spooked, it's not good to let any of your cards carry that high of a balance. You risk cld and rate-jacking.  And that would not only cost you more money, but more of a possible decrease because you would have less credit available.

[athensguy]

I would guess that you will probably stay over 700. Did you pull your FICO from this site or Equifax.com? If so, why don't you plug info into the score simulator at one of those places and see what range it gives you.

I personally have high util, too, and halfway decent scores.

24% overall with a high of 72% on one card.

[haulingthescoreup]

I dunno, that 95% on the BT might set something off, as it will count as being maxed-out. (Don't know for sure, though.)

I did a BT that would up showing as 84%, and I made a point of getting it down PDQ. It was just too scary at that level. I made one lump payment to reduce it to 75%, and then another to get it to 69%, and then I settled down to the slower repayment plan I'd worked out.

I can't tell you about the score affect, though, as I had a lot of new accounts hitting at the same time.

[Anonymous]

mizzou did you BT or make new purchases to hit 95 percent utility? If you transfered balances some of the maxed out card effect might be mitigated by a lower number of cards with a balance. If you hit that utility level with new purchases you might take quite a hit. I think 20-30 points is fair to expect. It won't take your credit but it will be sitting lower in the good range.

[Anonymous]

Since your overall utilization didn't change much, I don't think you'll take too much of a hit. Do get that balance down, however, as 95% isn't doing you any favors, even if it is just one card.

[RobertEG]

I offer only what FairIsaac has said about this in one of their recent webinars.  When asked which counts more, overall util or individual card util, their response is that both are scored approx. the same.  This implies that high util on one card can be substantial.

[Anonymous]

Yes, I believe you will take a hit in the neighborhood of 10-15 points for the 95% balance - even on only 1 card.

[Anonymous]

Thanks all for your responses. I got BofA to increase my credit line, so the utilization on this one card is down to 55%. Now, I will have to wait and see what happens to the scores.

[haulingthescoreup]

Sounds good!

And FWIW, several members here with scores in the low/mid-700's and above (if I'm remember correctly) have found that they don't get a score ding for just one nearly-maxed out card.

But of course, the other thing to keep in mind is whether your other lenders will freak out when they see it. The attitude among lenders these days seems to be shoot first, ask questions later.