Overall vs. Indiv %Util

[RobertEG]

Debtisgood, I see your point.  Weighting is a subset with the scoring, so equal weighting does not necessaril mean equal scoring.  Great analysis.

Using your great example of five cards, the weighting of indiv vs overall may be the same, but when scored, the indiv may only the be scored at about 1/5 as important as overall.

Message Edited by RobertEG on 05-24-2008 08:15 PM

[Anonymous]

Marty,

With all things being about equal - what is the score drop you noticed when you had an extra balance report?

How many TL do you have and does the second CC balance drive you over 50% of accounts with balances?

I think your info could be very helpful because it could give us an idea as to how many points in the utility category are controlled by % of accounts with balances.

[marty56]

My total %util didnt change since the other card balance droped.  The util on the charged card was <2%.

I dont have the TU report since it expired and it dont rember how many points.  My EQ score did drop 1 point.  Before anyone makes a remark about one point, the score change was 720 to 719.  That would have taken me out of the cut off range of certian auto loans.

Next month the new card balance should report as 0 so we will see what happens with my TU score.

Also TU has a comment about high FICO achievers only having 3 balances (all types) reporting and it does state that it helps your score.  We will see.

[marty56]

I forgot to add the on TU my total util went from 10% to 4 % yet the score simulator said the my best result would be 795 vs 806 with the 10%.  If that is true, then the second CC reporting a balance os huring me more then EQ.

I know its only a simulator but it made me think.  Anyway we will see next month.

[fused]

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marty56 wrote:

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.

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I have noticed TU being the most sensitive when it comes to util calculations and the number of accounts reporting a balance. My overall util went from < 8% to only 18% and TU pimp slapped me for 31 points. Amazing!!!!!!!

[marty56]

I actually only have one CC at 12% util which is 4% of my avialable credit.  Next week it will be at 5% util or <2%.  total We will see then by late June what happens to my scores.

TU does seem to be most interested in util and # accounts reporting.  EX seems next butI havent figured them out (if we can figure a CRA out that is).

EQ is less sensitive to balances and # cards reporting but I cant escape its dislike of major derogs and despite with the simulator says it will be bellow 760 for 4 more years.

I cant prove this but I would think from a FICO standpoint that 50% util on a total available credit of say 20 k is worse then 50% util on a card with a 300 cl.  FICO can and should realize that a 10k debt is more at risk then a $150 one.

[fused]

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marty56 wrote:

I cant prove this but I would think from a FICO standpoint that 50% util on a total available credit of say 20 k is worse then 50% util on a card with a 300 cl.  FICO can and should realize that a 10k debt is more at risk then a $150 one.

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This topic was beaten to death in the early myFICO days. From a FICO scoring stand point there is no difference. FICO will only factor util percentage and not the $$ amount. Lenders looking at your reports will have other opinions though.

Card A: CL 10K, bal 5K = 50% util

Card B: CL 500, bal 250 = 50% util

[marty56]

In that case I might squeeze a few more point out of my TU and EX scores when I get the account to 5%.  We will see.

[RobertEG]

Marty, I think you are correct that maybe absolute balance levels as opposed to just %util may also be scored, but once again, not being privy to the inner workings of the FICO algorithm, it is mere speculation. 

Sure, being at 50% util on a high CL card (e.g., $20K limit with $10K balance) is certainly not the same as being at 50% util on a low limit card (e.g., $500 limit with a $250 balance), although both score at 50% util.

But maybe FICO rationalizes this by the impact on overall %util, as opposed to individ cards..  For example, in the next month's payments.,. suppose one pays $250 on each account.  The high CL card experiences negligible change in %util, while the low CL card %util goes to zero.  However, overall %util change is also negligible. 

I dunno know if in scoring utilization, the FICO algorithm looks only, or primarily, at % util, or if it also looks at the actual, total level of account $ balances separately from util percentage.  I know that they look at the percentage of cards with balances, but do they also look at the level of those balances?  Maybe some of our FICO gurus could shed some light on this?

Message Edited by RobertEG on 05-29-2008 09:31 PM

[Anonymous]

I don't think they look at $ amounts at all-