Overall vs. Indiv %Util

[haulingthescoreup]

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@smallfry wrote:

5 or 6 credit cards along with a store card should be enough to satisfy the number of accounts with a balance. Assuming your personal expenses don't exceed 5K monthly then 100K available credit is sufficient. Having a CC with a 20K limit should allow you to charge enough so you never go over the 9% threshold on any individual card.

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A lot of this depends on how many non-revolving accounts you have. Since the goal is half or fewer of all open accounts, including loans, mortgages, etc, AND fewer than half of revolving accounts, you wind up needing one PIF'd CC to cover for each installment account.

With 3 non-revolving accounts (mortgage, HELOC, and SL) and 5 cards, it was a scramble to keep more than one card from reporting, since one card was actually DH's. If I had had a car loan and a signature loan as well, 5 cards wouldn't have been enough. After my app-o-rama, at least I don't get this message any more!

I'm not disagreeing at all! I love the idea of 5 bank cards and one store card. For other members, just realize that if you're a bit over-loaded on the installment loan side, another one or two CC's might come in handy for this one purpose.

[smallfry]

Hauling you are correct if one has lots of installments open. Possibly up to 10 cards in that situation would be prudent. Another reason why it might be a good idea not to be so quick to close rebuilder cards if they are in ones report.

[RobertEG]

Yes, smallfry, I agree.  Number of cards with balances is another factor that is weighted, and not just %util, individually or overall.  The number of cards with balances is an absolute.  It is either at 0% util or it is not.  Once above 0%,  the %util then looks at how much above 0% it is. 

Fair Isaac has stated that for cards above 0% util, indiv card util and overall util are weighed the same.  What is still missing from cracking the FICO wieghting in utililization is the answer to the question of how weighting of %util compares with the weighting of cards iwth balances.

I doubt that FICO will tell us this, but that is the unanswered question

[fused]

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Timothy wrote:

Yes- It has been posted here MANY times the indv utl counts the "same" as overall utl-

In my experiance overall utilization counts more-

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I agree! I just cannot prove it.

[RobertEG]

I believe that it was myFICOBarry who made those comments on the webinar on behalf of FairIsaac, so maybe he could "weigh in" on this issue?

It is an important planning strategy for one about to app for credit.

Message Edited by RobertEG on 05-23-2008 09:57 PM

[Anonymous]

I am sure he is right is the sense they are "Weighed equally" - they just are scored different !!!!!!!!!!!

I don't think Barry can go into much more detail than what was discussed as I/we have asked several times for more detail-

They are both important-

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RobertEG wrote:

I believe that it was myFICOBarry who made those comments on the webinar on behalf of FairIsaac, so maybe he could "weigh in" on this issue?

It is an important planning strategy for one about to app for credit.

Message Edited by RobertEG on 05-23-2008 09:57 PM

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[RobertEG]

Huh? 

If so, that would be a trick of speaking  out of both sides of the mouth through the same tongue that is beyond my comprehension!

"Weighed the same" clearly implies "scored the same," for weighting has no meaning if not referring to impact on scoring.

I can understand and appreciate why FairIsaac would not want to reveal anything more than general observations about the details of its proprietary scoring algorithm.  But we can only ask. 

[Anonymous]

RobertEG,

Weighed the same does not necessarily equal scored the same.

Say the category has 155 points up for grab (just a number, who knows)

It might be that both categories, overall and indiv util are worth 70 points, with # of balances being 15.....that would make them weighed equally

But it is possible that there is a different formula for scoring each. As a matter of fact, they would probably have to be...because on indiv utility you may be judging multiple balances collectively (% util on cards reporting balances) and then as single accounts as compared to an average (% util on all accounts).

If you had 100k in credit on 5 cards with 20k each and with only 1 reporting at 19900, you would have good overall utlity and a horrible individual utility, so clearly they are graded on different formulas.

The question becomes,

If you have x amount of debt, is it better to carry it at say 30-40% on all cards or to have it at 60% on a smaller number. It probably depends on the numbers and I would lean toward the former, but who knows.

[Anonymous]

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debtisgood wrote:

The question becomes,

If you have x amount of debt, is it better to carry it at say 30-40% on all cards or to have it at 60% on a smaller number. It probably depends on the numbers and I would lean toward the former, but who knows.

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very good response.

second, i think it may be profile/bucket dependant for it to be better to limit the number accounts with balances and take a uti hit one a card or two or than to spread it out.

just my theory though, from my experince.

Message Edited by imducky on 05-24-2008 12:13 PM

Message Edited by imducky on 05-24-2008 12:13 PM

[marty56]

For my credit profile, (1 car loan, 1 mortgage) I can only have one credit card report a balance.  If a 2nd one reports, my score goes down regradless of its util or total util.  Seems to affect TU the most.