EXPLANATION OF UTI

[ALLGOOD351]

Would someone explain to me how UTI on credit cards affects scoring

Currently I have 4 CC all with a total UTI of 90% due to a medical emergency with my dog.

I recently saw a 75 point drop in my Credit Scores going from the mid 600's down to 515.

My TU went from 606 to 510 My EX went from 600 to 505 My EQ went from 663 to 535.

Why would I have recieved that much of a drop; My UTI was around 60 percent before the pet emergency.

Where do I need to be UTI to get back up in the 600's?

[Anonymous]

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@ALLGOOD351 wrote:

Would someone explain to me how UTI on credit cards affects scoring

Currently I have 4 CC all with a total UTI of 90% due to a medical emergency with my dog.

I recently saw a 75 point drop in my Credit Scores going from the mid 600's down to 515.

My TU went from 606 to 510 My EX went from 600 to 505 My EQ went from 663 to 535.

Why would I have recieved that much of a drop; My UTI was around 60 percent before the pet emergency.

Where do I need to be UTI to get back up in the 600's?

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Going above 89% util is considered maxxed out and will severely impact your scores.

69% is another threshold.

So if you were below 60%, you crossed 2 thresholds and the score decrease makes perfect sense.

Ideally you want under 30% util, and actually the lower the better, but you will need to get back down below 69% if you want to get back to where you were before. You are leaving a lot of points on the table by carrying high util. If it is 0% promo on care credit and are not looking to get credit products in the meantime - doing what is financially best for you should be priority.

[Shooting-For-800]

89

69

49

29

9

[Anonymous]

Agreed with @Anonymous - crossing two score thresholds is a score killer, and to also have all cards in maxed territory hits even harder. Paying them all down to 87% will get you out of maxed territory and leave enough headroom that you shouldn't cross back into max-out after interest is added in when the statements cut. That's your first step.

How high are the limits on the cards? If you can get all of them down to 87%, that'll help. If the balances aren't huge and you can pay further to get some or all down to 67%, that'll help even more. Lenders get gunshy pretty quickly with high balances for any length of time, and that's only been made worse by Covid. Best plan:

Pay all under 87%, and call each to ask for a mid-cycle update. They may not do it but if they will, it'll get those cards on record for your other lenders to see your balances are dropping.

Pay all under 67%, then 47%, and so forth. Again, the recognized thresholds are 89/69/49/29/9% but going to the 7s rather than the 9s will help keep you under your newly-crossed thresholds after interest is added.

Good luck with it all and I hope your furbaby is better now

[Anonymous]

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@ALLGOOD351 wrote:

Where do I need to be UTI to get back up in the 600's?

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Any profile changing event that causes a drop of X points if reversed will result in a gain of X points.  Therefore, in order to return your scores to where they were prior to your balance increases, you'd simply need to return those balances back to where they were and have them report that way.

While OP didn't mention the balances on each card specifically, in addition to aggregate and individual card penalties it's also possible that his number of accounts with a balance increased as well, another score-reducing factor. 

[SouthJamaica]

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@ALLGOOD351 wrote:

Would someone explain to me how UTI on credit cards affects scoring

Currently I have 4 CC all with a total UTI of 90% due to a medical emergency with my dog.

I recently saw a 75 point drop in my Credit Scores going from the mid 600's down to 515.

My TU went from 606 to 510 My EX went from 600 to 505 My EQ went from 663 to 535.

Why would I have recieved that much of a drop; My UTI was around 60 percent before the pet emergency.

Where do I need to be UTI to get back up in the 600's?

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1. Aggregate revolving utilization has a huge impact; it's best for it to be at 9% or less.

2. Individual revolving account utilization has a huge impact; it's best for no account to report greater than a 28% balance.

3. Most likely, when you get back to your previous utilization levels, you'll get back all of your points.

[ALLGOOD351]

Some of you asked what my balances to limit are, maybe this will help you help me formulate a plan

Care Credit - BAL $1850 - CL $4500

Credit One - BAL $1580 - CL $1600

MERRICK - BAL $1185 - CL $1200

KAY JEW - BAL $987 - CL $3000

[Anonymous]

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@ALLGOOD351 wrote:

Some of you asked what my balances to limit are, maybe this will help you help me formulate a plan

Care Credit - BAL $1850 - CL $4500

Credit One - BAL $1580 - CL $1600

MERRICK - BAL $1185 - CL $1200

KAY JEW - BAL $987 - CL $3000

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Ok, so looking at your numbers provided above, your individual utilization per card is at:

41%

99%

99%

33%

And your overall utilization is at 54%

Step one is to get both of those 99% (maxed out) cards down below 49% utilization.  This can be done with under $1500 paid down on your end toward those 2 cards... say $825-$850 toward the first and $625-$650 toward the second.  This change to your aggregate utilization will not only get all of your individual cards below 49%, but also take your aggregate utilization down to 39% or so, meaning it too will have crossed a significant threshold.  Again, cost of this step is roughly $1500.

Step two is to next get all your cards down below 29% utilization or so.  I would start with the two cards that you already just paid down from maxed out to below 49% since they have your lowest limits, so an equal paydown on those relative to the other cards would yield a greater percentage drop.  It would only take another $500 ($300 to one, $200 to the other) to get those two below 29%.  It would then take you another $600 roughly toward the first card and $200 toward the final card to get those 2 under the threshold.  Cost to achieve this step would be roughly $1300.

At that point you'd be in a very good place and would just want to repeat the process to drop to 9% or below on everything.

[Anonymous]

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@ALLGOOD351 wrote:

Some of you asked what my balances to limit are, maybe this will help you help me formulate a plan

Care Credit - BAL $1850 - CL $4500

Credit One - BAL $1580 - CL $1600

MERRICK - BAL $1185 - CL $1200

KAY JEW - BAL $987 - CL $3000

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In addition to getting your util down on Merrick and CO, how long have you had Care Credit? Have you ever requested or gotten a CLI from them and if so, when?

Once you get those balances down on the 2 cards below maxxed out (and preferably under 50%, but at least under 69%), it could be a good time to ask for a CLI on Care Credit. They tend to be generous with CLIs, but I wouldn't gamble it with the high util on the 2 cards. 

Getting a CLI on Care Credit can help your overall and individual util on that card and especially if you got promo financing for your pup. You didn't mention if you did or not. That would help your scores and give you some breathing room to take advantage of the promo. Just remember to pay off the entire promo balance before the end of the promo time period so you do not get hit with back-interest.

SO got 18m promo on 1k, so hopefully you got 12-24m promo on your Care Credit purchase (if the whole amount was from the recent vet visit).

Plus while taking advantage of 0% promo, you can focus you funds on the cards that are charging you interest monthly.

Good luck!