High Balance?

[Anonymous]

I am working on util.. I pulled all 3credit reports and noticed dates of High balances notated on accounts. My question is what % of balance is considered High?? and what effect on future scores does this have..

[jbsea]

Well everywhere you read 30% utl is the high you want to be at.  For scoring purpose you would want to be down under 9% (2% seems to be my sweet spot).  That would minimize your score.  Utl has no memory so as soon as you bring your balances down you will see your score go up reflecting that change.

[Anonymous]

Ideally first you want your total or aggregate utilization for all your cc's to not be more than 30%, and no individual card more than 30%. Then after achieving the 30% goal for all accounts and each one individually, it's optimal to be within the 1-9% range again for all accounts. So if you have 5 accounts, keept the total balances on all those 5 accounts combined < 30%,  and no 1 card above 30%. Pay off 4 of the 5 accounts to ZERO, and leave just 1 card between 1-9%. 

There are always real world exceptions. If you have a clean record with no derogatories or late payments or collections, no public records, and a good age on those accounts, your utilization % can be higher than 30% and still have a high score. Then w/o any negatives, as you pay your % down, your score will go up. 

Apart from paying your bills on time ALL the time, the other gretest thing you can do to positively impact and improve your score is to pay down your cc debt, cut back on unncessary spending, and add a new credit card to increase your total credit limit. Everybody has a different situation and story. 

[Thomas_Thumb]

Aggregate utilization has a much greater impact on score than does utilization on a per card basis. The general rule is to keep aggregate utilization under 10% for highest score potential.

An individual card (in my experience) can post at least 50% utilization without any negative impact on score if overall utilization is maintained under 10%. I generally recommend staying under 50% utilization (on specific cards) and to always pay each in full. If you are in credit building mode and don't need to maximize score in the short term, an aggregate utilization up to 20% should be fine. The key is to reduce/hold aggregate utilization to under 10% a couple months before applying for new credit.

[cashnocredit]

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@Anonymous wrote:
I am working on util.. I pulled all 3credit reports and noticed dates of High balances notated on accounts. My question is what % of balance is considered High?? and what effect on future scores does this have..

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None.  The current balance relative to the CL is what counts for FICO scores. Both for each card and for all cards together, In fact a very high high balance, as long as it was in an earlier billing period, is looked on favorably by underwriters and some specialized scores. It's a strong indicator you can pay if you run up another large balance in the future.

[NRB525]

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@cashnocredit wrote:

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@Anonymous wrote:
I am working on util.. I pulled all 3credit reports and noticed dates of High balances notated on accounts. My question is what % of balance is considered High?? and what effect on future scores does this have..

---

None.  The current balance relative to the CL is what counts for FICO scores. Both for each card and for all cards together, In fact a very high high balance, as long as it was in an earlier billing period, is looked on favorably by underwriters and some specialized scores. It's a strong indicator you can pay if you run up another large balance in the future.

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+1

Finally someone answered the question

The question relates to high balance, which is a historical number. Current utilization is the other topic being discussed above.

[Anonymous]

"Finally, someone answered the question" -- that is going to keep me cheerful for at least a month.

[elim]

due to past CDL's and moving limits, some of us have "high balance" many times greater than our limits.  all is well.

ps: (it looks real good to have a big HB on a charge card)

[Thomas_Thumb]

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@elim wrote:

due to past CDL's and moving limits, some of us have "high balance" many times greater than our limits.  all is well.

ps: (it looks real good to have a big HB on a charge card)

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Elim, this may be a bit off topic but thought you might know if there is a short term impact associated with increasing HB on a AMEX charge card 5 fold?

I currently have an AMEX with a $2000 HB and I am thinking of charging $10,000 on the card (car downpayment) and then PIF the charge when it posts on the statement. Would my score take a big hit (current score is 850)? I could just use a check for the downpayment but, I have always wanted to boost my AMEX HB when a good opportunity presented itself.

[elim]

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@Thomas_Thumb wrote:

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@elim wrote:

due to past CDL's and moving limits, some of us have "high balance" many times greater than our limits.  all is well.

ps: (it looks real good to have a big HB on a charge card)

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Elim, this may be a bit off topic but thought you might know if there is a short term impact associated with increasing HB on a AMEX charge card 5 fold?

I currently have an AMEX with a $2000 HB and I am thinking of charging $10,000 on the card (car downpayment) and then PIF the charge when it posts on the statement. Would my score take a big hit (current score is 850)? I could just use a check for the downpayment but, I have always wanted to boost my AMEX HB when a good opportunity presented itself.

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  as long as amex doesnt get scared then the only outcome will be higher spend ability.    smart thing would be to pre-warn them of the change in spend pattern and everything should go smooth.

way to collect those MR's