My experiences have been similar. While I don't really have a "thin file," (have 17 - 21 accounts reporting) I do have a young one (AAoA less than 5 years).
When I assiduously tried the experiment -- paying all cards and accounts down to 0, my FICO 8 was dinged between 22 - 27 points. Tried this a few times, always the same result. All tested with Experian (I assume the other bureau's scores would behave similarly, as well). WIthout any active accounts reporting (in other words, by being extremely financially responsible), FICO's algorithms have no data to work with, so they penalize you. Also, the obvious subtext is that FICO works for lenders, not the public; their interests clearly do not align with consumers. This whole crazy system exists to both mitigate risk for lenders as well as simultaneoiuly encourage use of credit, hence the apparently contradictory behaviors of their algorithms. You're damned if you do and damned if you don't -- and the credit bureaus are laughing "all the way to the bank," making money "hand over fist" and making many of our lives miserable in the process.
When (during COVID's peak), my utilization on a single card approached 50%, with total utilization still below 9%, I was dinged around 32 points -- which remained until I paid that card back down to below 9%. What's the use of having credit if you can't use it -- this, I suspect, may be one of the reasons many of us on this site chase more and more credit cards and higher limits. I can't imagine ever approaching my total revolving credit limit of more than $100K, but at least if I need to use a little bit (less than 9%), it wouldn't kill me. Probably I should shoot for $200K, to be safe.... the insanity of this is obvious, the stress totally unnecessary. We all have more important issues to deal with in our lies than how to satisfy these &^%#^ algorithms and systems! I remember when loans and credit were extended by human beings, who considered the character and needs of their customers in making lending decisions, as well balancing the safetly concerns of their institutions. Not a perfect system, with opportunities for abuse, redlining and other disciminatory practices -- but there was some value in the direct relationship. The flip side, of course, is that this technology has enabled broader scale and reach for lenders and more access, overall , overall not a terrible result. Balancing the benefits and impacts of today's technologies is certainly an au courant topic.....
So, net, net -- I my experiences confirm what all the other posters are reporting and reccomending. With a limited number of cards reporting in your file, the impact of high single-card utilization, as you described, would be magnified.
Other sources on this site rather consistently mention that the ideal total utilization is not 0% but actually 1%, with one or preferably a few accounts reporting. This appears to be true for both total utilization and each account -- although many posters indicate that not more than either 6% or 9% utilization on a single account might be OK as well.
On the up-side, once you make payments to bring this account back down below these thresholds, your FICO should bounce back the next time the issuer reports, as noted by other posters. You'll recover quickly from this hit.
Best of luck!
