Magic line at 90%?

[tcbofade]

The subject came up on the credit card board...and I'm curious.

Does having a credit card report over 90% have a negative affect on your score?

OK, dumb question...I'll rephrase it...

Is it better to have six cards at 92% or seven cards at 88%?

I find it hard to believe that it would make much difference...but if 90% is a red flag and 88% isn't, that would be something I'd like to know. 

Thoughts?

[GregB]

I believe you will find the "red flag" is at 80%.

There is a penalty for having any one card maxed out or being maxed out for total utilization. There is a further negative for any card being over 100% and more for being over 100% total utilization.

I am fairly sure that maxed out is defined as 80-100% and that there is no change at 90%.

I did see some discussion recently about something happening at 90% but it didn't look accurate to me as I recall. I think they were confusing revolving debt with installment/mortgage debt.

[tcbofade]

Thanks for the info. 

I've spent the last 48 hours or so trying to refigure my budget to get every card under 90% in the next 45 days, and I just can't do it anyway.

Humph.

[RobertEG]

The hidden impact may be more in future scoring than current impact.

Very high % util is often a trigger used by creditors to reduce future risk by lowering CLs as util is paid down.

It may be difficult, once credit line decreases begin, to reduce future % util.

I, personally, would be just as concerned about potential creditor view of high % util.

[tcbofade]

I'm sorry that I wasn't clear...my OVERALL util is somewhere around 50%....not great, but not terrible.

I have several cards with zero balance, but I also have several cards that are maxed.  (over 90%)

My thought was that I could "spread it out" a bit more evenly if it would help my score...but I don't think I can make any significant difference any time soon.

so, I'm just paying off one account every month...so far, so good.

[Anonymous]

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@tcbofade wrote:

I'm sorry that I wasn't clear...my OVERALL util is somewhere around 50%....not great, but not terrible.

I have several cards with zero balance, but I also have several cards that are maxed.  (over 90%)

My thought was that I could "spread it out" a bit more evenly if it would help my score...but I don't think I can make any significant difference any time soon.

so, I'm just paying off one account every month...so far, so good.

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I've seen other people suggesting to attack the higher interest cards first...I really started caring about my credit just this past February; I pulled my report and my scores were in the toilet. 520-560 range. I am tired of paying 11.9% interest on my mortgage and driving a 10yr old crap car, so I'm taking action. What I did with my income tax refund was pay down 90-100% of my credit card balances and paid off the collection accounts. I also disputed some wrong information on my reports and it was all removed. My scores are now just a couple points away from 600 across the board!