How is Credit Utilization calculated?

[alexgold9393]

First off thank you so much to everyone in this forum. I have been rebuilding my credit for the past 12 months and its all because I read read and read all the info from all you wonderful myficonians. 

Quick question about CUR, I have 6 cards with 5 of them having $0 balance and one of them utilizing 81%, my overall CUR is at 14%. Is my score being punished for that high balance (529/651)? Or am I ok since I have the overall CUR under 15%

I plan to pay it off in the next two payment and I'm going farming, what would you recommend for the farming time?

[simplynoir]

You're fine especially if you plan to pay off the balance on that card in the next two months. Temporary spikes in UTL on a single card shouldn't hurt you.

[RobertEG]

FICO scores on both the overall % util and on the % util of each card.

With the same overall % util, a profile that has one card at a very high % util has a proportionally greater negative impact than having all at or near the overall % util level.

Yes, it is hurting.

Keeping it at a high % util may also trigger a credit limit decrease on that card, so it is prudent to get it down as soon a possible.

[sarge12]

After I stop laughing at your refering to us as myficonians, I'll try to evaluate how we should feel about being called that. Right now I'm to amused to know if we were complimented or insulted. lol!!!

[Anonymous]

As RobertEG says, there is a penalty for having high individual utilization -- and CC issuers can view a person with past negative items who has a high util card as a real risk, resulting in balance chasing or other kinds of adverse action.  Get the card to under 67% as soon as possible, with the goal of paying it off soon after that.

People here use the word gardening rather than farming, though I think farming is kinda cute.  My own recomendation, since you ask, is to stay in the garden until all your scores are at least 750.  If you think you might buy a house in the next few years, stay in the garden until you own the house.  You have six cards now.  There is no scoring advantage to having a 7th -- it can only hurt your score, not help it.

The only exception might be if you have no loans, in which case I'd consider implementing the Share Secured Loan Technique later this year.

[Anonymous]

OP, there are two things that will raise your scores here and both may be "worth" around the same amount of points.

One, taking your overall utilization from 15% or whatever you're current at down below the 8.9% threshold.

Two, taking your high utilization card that's at 81% or whatever utilization down to below 28.9% utilization.

Fortunately, taking care of Two above also takes care of One.  Both of these threshold crossings combined IMO would yield a score gain probably to the tune of 30-35 points.

[SouthJamaica]

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@alexgold9393 wrote:

First off thank you so much to everyone in this forum. I have been rebuilding my credit for the past 12 months and its all because I read read and read all the info from all you wonderful myficonians. 

Quick question about CUR, I have 6 cards with 5 of them having $0 balance and one of them utilizing 81%, my overall CUR is at 14%. Is my score being punished for that high balance (529/651)? Or am I ok since I have the overall CUR under 15%

I plan to pay it off in the next two payment and I'm going farming, what would you recommend for the farming time?

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Yes you are being punished.  Overall revolving utilization percentage is one factor. Your individual card percentage utilization is another. Only way not to be punished significantly is to be below 29% on that card.

[HeavenOhio]

Welcome, @alexgold9393.

Just to clarify, the individual card utilization portion of your score is determined by the single card with the highest utilization. 81% is high, and you're taking a hit for that.

If your aim is to report a positive balance on one card with the rest reporting zero, that's good for your score. Given your limits, the simplest way to do that would probably be to report that balance on your Discover card. A balance of $350 or less would have you under the 8.9% overall utilization and 28.9% individual card utilization mentioned above.

I'll add that some have reported being dinged with utilization that's less than 8.9%/28.9%. If you'd like to know how your profile reacts, report a very small balance on one card (at least $5 but not much more than that), with the rest reporting zero. Then try reporting $300–350 on your Discover card. You may find that there's no difference at all. Or you may see a difference and find it to be either acceptable or not. The bottom line is that the test is safe to do because it keeps you well within the range considered to be responsible borrowing.

[alexgold9393]

Thank you so much for everyone's answers. I appreciate the fact that you all take time out of your busy days schedule to post and give answers to people like me. 

[Anonymous]

You are very welcome... good luck!