Lowering UTI: How much of an impact?

[beezer32]

Generally speaking, if someone has a an overall utilization percentage across all cards of 30-50%, wouldn't lowering the utilization rate across all of those cards to 9% or less significantly improve a credit score?

If a FICO score is 35% based on utilization, the score should heavily fluctuate with utilization changes right?

I have UTI rates in the 0-60% ranges across 7 revolving accounts. I was wondering if I paid them down below 9% immediately, what could happen to my scores as opposed to gradually paying them down on a monthly basis?

So basically: Fast pay down or gradual for best score increase? I know there are many factors and YMMV but I thought I'd ask for opinions. Thanks!

[longtimelurker]

Utilization score is just a snapshot with no memory, so it doesn't matter how you get there.  If you pay down to 9% immediately, you will get a score jump.   If you pay it down slowly to 9%, you will get  the same score jump when you finish paying it down to 9% (apart from things like AAoA going up because of the time etc!)

[beezer32]

That's precisely the answer I was looking for! Thanks!

[Anonymous]

Yes. You could get a huge bump. I've seen 50 point swings going from 50% util to 30%

[lrodrig]

Just to offer another data point. My score went up by 30 - 40 points last week after my utilization went down to around 25% from 50% (we had a bunch of medical bills and work travel reimbursement). Experian went up a whopping 43 points. Yesterday myFICO reports another balance decrease and Experian went *down* 9 points. Equifax went up as a result of the same decrease alert today by 10 points.

I just don't understand.

[Anonymous]

If you are paying interest, you should definitely pay off your balances if you are able to do so.

[lrodrig]

15% percent of that balance is on 0% terms. Rest gets PIF every month.

[Anonymous]

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@Anonymous wrote:
Yes. You could get a huge bump. I've seen 50 point swings going from 50% util to 30%

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"Could" is the key word here.  Results vary greatly from person to person.  While some have reported huge point gains from dropping utilization, other have reported next to nothing.

A little over a month ago I dropped my overall utilization from 44% to 8% and AT BEST I saw 2-3 points gained on all of my FICO 08's.  That 8% was with all accounts under 10% BTW; there were no high ones factored in at all.

[SouthJamaica]

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@beezer32 wrote:
Generally speaking, if someone has a an overall utilization percentage across all cards of 30-50%, wouldn't lowering the utilization rate across all of those cards to 9% or less significantly improve a credit score?

Yes

If a FICO score is 35% based on utilization, the score should heavily fluctuate with utilization changes right?

Right

I have UTI rates in the 0-60% ranges across 7 revolving accounts. I was wondering if I paid them down below 9% immediately, what could happen to my scores as opposed to gradually paying them down on a monthly basis?

It would help but it would be best if you had 4 of them reporting at zero, and 3 or less of them reporting at 9% or less

So basically: Fast pay down or gradual for best score increase? I know there are many factors and YMMV but I thought I'd ask for opinions. Thanks!

The faster you pay it down the faster your scores will go up.

[Anonymous]

Low util is a huge deal.  It's one reason many people pad their credit and seek high CL's.  That way you can let your balances report to show good payment history and maintain a great credit score at the same time.