Previous monthly utilization calculation

[Zach100]

Does previous monthly utilization matter when calculating current FICO?

1st Example: Starting in January 2020, I have a $5000 Limit and its maxed 100% using a 0% balance transfer, I make the minimums every month. 11 months later in December 2020, I pay off the card or pay it down to 1% utilization. I pull my score in January 2021, not worried about those 11 months. Would the end result be worse than paying it off fully every month like example 2?

2nd Example: I use my card every month, but pay it off before statement cycle. Every month reports paid in full. 

In the end, January 2021 FICO Score, would both examples be the same score or does FICO calucate each month utlization to calculate current FICO?

Hopefully I explained that correctly.

Thank you for you help!

[GatorGuy]

Honestly couldn't really follow your example but utilization is only calculated into your current score with the current reported balances. It doesn't matter what the previous month's utilization was.

[Zach100]

Thank you Gatorguy. Thats what I needed to know! Since the past doesnt matter, I'm going to max out 3 cards doing 12 to 21 month 0% offers. Then I'll pay them off the last month. Then the score will be back to normal. I just didnt want the FICO Score to be affected from maxing out the cards in the past.

[RobynJ]

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@Zach100 wrote:

Thank you Gatorguy. Thats what I needed to know! Since the past doesnt matter, I'm going to max out 3 cards doing 12 to 21 month 0% offers. Then I'll pay them off the last month. Then the score will be back to normal. I just didnt want the FICO Score to be affected from maxing out the cards in the past.

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This is for Fico 8 and others but I do believe the new Fico 9 and fico10t scores it does. They are not really used so to say but in the future I would say yes it would matter but as of now not really. 

[SouthJamaica]

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@Zach100 wrote:

Thank you Gatorguy. Thats what I needed to know! Since the past doesnt matter, I'm going to max out 3 cards doing 12 to 21 month 0% offers. Then I'll pay them off the last month. Then the score will be back to normal. I just didnt want the FICO Score to be affected from maxing out the cards in the past.

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Nobody says it doesn't matter; it's just not calculated in utilization.

Maxing out cards could cause other problems for you. I don't recommend it.

[GatorGuy]

@SouthJamaica is correct. Maxing out 3 scores will put a sizable dent in your credit score. If you carry a balance with anyone else, those lenders may decrease your credit limits. Even if you don't carry a balance you may see CLDs

[PNWRambler]

BT cards often expect you to carry a large balance for a short time, but as previously mentioned it will ding your score until they're paid down and can cause issues with other lenders or cards you may have.  You could try just using 75% of each of the BT cards, that won't look quite as risky as three maxed out cards... But it will still ding your score until they're paid down.

[RobynJ]

Just to explain what I was trying to say. Yes I agree it matters for the overall health of your credit but what I meant is the scores wouldn't ding you once it was paid unless it's the newer Fico versions since a score is a snapshot in a timeframe and only scores what it sees at that time. The new trending models will however ding you and continue to for a period of time. 

[Mdowning30]

You're just asking to lose 100+ points ?

[OmarGB9]

Previous utilization WILL/IS factored into your score on the new FICO 10/10T models.