@Thomas_Thumb wrote:Below taken from Q&A thread and link provided
Re: We’re Tom Quinn & Tommy Lee - FICO Score Experts! Ask us anything.@Anonymous wrote:If I have 10 cards with a total credit line of 100K and I carry 8K of debt all on one card that has a CL of 8.5K, why does my score suffer so much, whereas if I spread that 8K of debt evenly on my 10 cards, my score does not take such a hit? I would think spreading it over 10 cards is more risky, if you add up the minimum payments of all 10 cards vs the minimum payment on 1 card. The monthly commitment would be higher spread over 10 cards.
Tommy Lee: The FICO Score considers both overall revolving utilization and the highest utilization on a revolving account. The weight given to each of these factors is based on historical data from millions of credit files, which indicates that both of these factors are predictive of future payment behavior.Message 73 of 112
Perhaps you were more impressed than I was with the answers by the FICO "insiders". Just because they say things doesn't make them so.
I am certain that the number of high-utilization accounts does affect my EX FICO 8 and FICO 2 scores.
How do I know? Because I tested it over and over again, on a daily basis, over a period of months.
@Thomas_Thumb wrote:I tested and came to the conclusion Fico insiders mention in the Q&A years before they divulged it. They mention highest card utilization as a scoring factor in multiple posts in the thread. So, there is no mistaking what they say.
Furthermore other posters, like the one asking the question, have provided supporting evidence over the years.
The Fico insiders did deflect answering some questions entirely. In other cases snswers were purposefully ambigious. That's not the case with highest card UT nor with their statements that aggregate revolving balance is considered in addition to aggregate utilization. A review of written negative reason statements disclosed aggregate balance as a factor 10-15 years ago.
The Q&A does not specifically speak to number of cards at high utilization levels being scored as a criteria. I contend that if you have 1 card at 90% and 4 at 55% and then drop 3 of the 55% cards to 45% it would be score neutral. The 90% card is the overriding factor. Dropping it to the next lowest interval would be a better strategy. If, on the other hand, your 4 highest cards are all between 55%-60% then dropping 2 of them to 45% might have an impact - imo. Why? QTY of cards in highest card UT interval was reduced from 4 to 2. The above assumes no boundries are crossed for aggregate UT or total balance.
The Fico insiders imply scoring of both revolving aggregate and card utilization in discrete range intervals in the Q&A. Of course, they purposely avoid specifying said intervals or listing of thresholds.
Isn't that exactly what I was trying to say?
@Thomas_Thumb wrote:No.
The OP mentions taking a card from 5% to zero or taking another card from 50% to 48% or taking another card from 70% to 68%.
Let's say there are individual card UT thresholds at 89%, 69%, 49% and 29%. If the OP has 1 or more cards at 70% then I contend taking a 50% card to 48% provides no point gain. However, taking a 70% card to 68% would provide a point gain if it is the only 70% card and may provide a smaller gain or no gain if 1 card remains at 70%.
I interpreted your feedback to the OP as saying a score boost can be realized taking any card from a higher to a lower Utilization interval.....
I never said any such thing. This is what I said:
One member who is more knowledgeable than I is of the view that only the highest utilized card counts for individual utilization, and that the lesser utilized cards are no longer factored into that metric. I.e., if one card is at 55%. and there is another at 35%. only the 55% one counts for scoring. My testing has proved to my satisfaction that this theory is not accurate, and that the number of highly utilized cards is also a factor. E.g. three 50%+ cards hurt one's score more than one 50%+ card.
It is clear to me that the number of highly utilized cards is also a factor.
Yes there might be "tiers".
And yes I would concentrate on the highest utilized card first.
But as to your new theory, which now admits that the number of highly utilized accounts is a factor, but only if they are within the same "tier" as the highest utilized card.... that is pure guesswork. And in any event, none of us know where the "tiers" are. We know only that 30%, 50%, and 90% are jumping off points.
@Thomas_Thumb wrote:The only things Fico states as fact regarding card utilization are:
1. Utilization is categorized in intervals for scoring purposes.
2. They look at highest card utilization for scoring.
Anything beyond that such as your hypothesis is guesswork. A lot of reported data lacks rigor, repeatability and independent validation by others. Validation by others is essential.
Certain types of testing can effectively isolate scoring factors but most do not. Layout a test plan, solicit feedback prior to testing to ensure sufficient rigor and then execute the plan as agreed. All too often other variables change during execution which confounds dataaand renders results inconclusivem
Feel free to set up a trial to disprove my hypothesis. I'd be happy to help design a rigorous trial plan. My spend level is too low relative to my card CLs to personally test elevated card utilization intervals these days. Up thread I laid out some test cases with predictions.
An ideal test file would be stable with respect to number of accounts, scoreable inquiries and have sufficient age to avoid crossing any boundries during the test period. If lates exist, they should not cross any age related thresholds.
When I was testing the effect of having more or less 50%+ accounts, these factors were all stable: the number of accounts, scorable inquiries, aging factor thresholds, highest individual account utilization, number of zero balance accounts, and aggregate utilization. The only thing that changed during that period of several months was the number of over 50% accounts. It was clear that having more cost points, and having less gained points. So I rejected the notion that only the highest individual account utilization percentage was relevant.
The limitation on my testing was that I could only do it with Experian, since that was the only one to which I had daily access to both scores and the reports.