How long will one month's high Utilization negatively effect credit?

[Anonymous]

So not going to lie, not off to the best start with my new Discover it card and have used it far more than anticipated this first month.

Unfortunately it was a sort of perfect storm, a roommate was moving out, we were having trouble finding someone else (we since thankfully have) but at the time it was either use up my credit line, or not pay rent, be evicted and end up homeless.

I got one month of zero Utilization and they reported right after I got the card, but this month we're probably looking at minimum 60 to 70 percent.

Is this likely to negatively take it's toll on my credit for months to come? Or if I get utilization back down going forward, which shouldn't be an issue, will it bounce back after two or three months of zero to ten percent? (my goal range)

Forgot to add I'm not going to have an issue making a payment on it, but it won't be a large payment may be closer to the minimum thus the 60 to 70 percent utilization estimateI won't be able to get it back down to a zero balance until my first paycheck of next month (get paid biweekly, would be the 7th of August) from there a steady 0 to 10 percent utilization should be maintainable.

[silver_idle]

If you can get your utilization down to about 30% or lower, you should be fine. It wont affect you in general but if you cannot bring it down in one payment, its best to pay more than the minimum payment to try to pay it off faster, but if its just going to be one month, then youre fine. People carry a balance all the time on a card, especially for large purchases. Though this may not be the case, but you dont have to panic. 

[RobertEG]

Carring a high balance for any sustained period could, depending upon the criteria of the creditor, trigger a review for a decrese in your credit limit.  That alone, if done, will result in a future increase in your % util due to a reduction in the denominator of the calculation.

I dont know the triggering criteria for a CLD for your specific creditor, but I would strive to get the % util under 50% as soon as possible.

[pipeguy]

As soon as you get your utilization below 30% you'll see an increase in score and when you get it under 9% you'll see a "full recovery" - that is assuming this is your only card, should you have multiple cards it has to do with overall utilization. Frankly, I've run my Discover up over 70% and carried that for a while (Balance X-fer offer) with NO ill response from Discover.  

Of course, I have a lot of cards and a lot of available credit, but also I have a long history which helps ease lenders' concerns (other than Comenity and Barclays perhaps). 

[Anonymous]

This is my only card, in fact it's my first credit card in over twenty years.... Which is why I'm so concerned, not a good start and I hope if I prove myself going forward which again shouldn't be a problem that Discover won't hold it against me in terms of possibly unsecuring (it's the secured version) and just see it as what it will be, a one month blip on the radar.

[Anonymous]

I do also have a credit builder loan from self lender.

Have had that since April and haven't missed any payments with it, but those are my only two pieces of credit currently.

[Anonymous]

Given how you have described your situation (including the followup posts) you should strive to lower the card's balance as swiftly as possible.  The problem is that this is your only card.  Therefore both your individual utilization AND your total utilization are over 70%.  (With total U a person considers all his cards together.)

If you have friends or family that would give you a short term loan to help you lower your balance to less than 67%, that would be a very smart move.  Ideally you want to get that balance down to under 67% before the next statement prints -- that would be a huge step toward protecting yourself from Discover closing your card or sharply lowering the credit limit.

Even better would be if family could assist you in lowering your balance to under 47% and then consistently make over double the minimum payment.

[Anonymous]

Both my parents died from cancer, if one of them were alive, I know they would help without a hesitation.

Not comfortable asking my siblings, as they are largely living paycheck to paycheck.

I think everything should end up alright, as I can pay some of it when I get paid on the 24th and pay it down to zero as soon as the 7th of next month and from there should be able to easily keep a low balance going forward and pay it off completely each month.

My biggest concern remains this making it so they won't unsecure it eventually, but even then surely they won't let one bad month effect that, if I spend the next six to 18 some odd months with a low utilization and payments in full, at least I wouldn't think so anyway.

I think I'm going to call them as well in the next few days and explain I will pay in full by no later than early next month, their customer service seems great so far and feel comfortable doing so.

[Anonymous]

Sounds like you have a good plan.  A utilization of 68.99% turns out to be a pretty critical breakpoint for CC issuers and for FICO.  If there is anyway you can get under that before the next statement, that would be a great move.  You estimated that your utilization would be 60-70%.  70% will be viewed very differently than 67%.  The 68.99% figure includes interest, fees, etc.

[Anonymous]

So quick update on this.

My money situation actually ended up being a bit better than what I anticipated it was going to be, so I was able to pay nearly all the balance down. My Utilization upon reporting in a couple of days will only end up being around 7 or 8 percent.