EQ 18 point drop after util reduction?

[Anonymous]

After my balance updated on one of my cards, which brought my total util to 0%, i lost 18 point!!! I though I would gain points if anything. Why does it feel like I am being punished for not having any debt?

[jeffm4688]

If every single revolving account you have is at $0 the FICO model counts that against you and you lose ~15 points, I guess 18 in your case. In order to maximize scores you'll want to let at least $3 post.

[Thomas_Thumb]

---

@Anonymous wrote:

After my balance updated on one of my cards, which brought my total util to 0%, i lost 18 point!!! I though I would gain points if anything. Why does it feel like I am being punished for not having any debt?

---

General rule is no balance on any revolving CCs => 10 to 20 point drop. Optimal score achieved by reporting a small balance (which you PIF after it posts).

The small balance reporting each month should be between 0.5% to 5% of aggregate CL as a guideline. Given your total CL of $1900, a good range for you would be $9 to $95 - your prior balance was in range. I suspect $5 to $100 would be ok as a range if you like round numbers - no need to split hairs.

In addition to utilization %, # cards reporting is a factor in scoring. You will see best results with only one card reporting a non zero balance. Note: If all your cards each reported $5 each, you would again likely lose 15 points even though the $20 total (aggregate UT% = 1%) is on target. 

Remember NO or ALL cards reporting a non zero balance hurts your score (if you have 3 or more cards). How many (% of) cards that can report a balance without affecting score is dependent on credit history in the file. You may get dinged if 2 of 4 cards report. In contrast, more seasoned profiles with no negatives might be able to report a balance on 3 of 4 cards without impacting score. So - no catch all for cards reporting except 0% and 100%.