Utilization?

[Patient957]

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@Thomas_Thumb wrote:

Installment loans help the mix rating and an open loan can be beneficial to credit score. However, lack of an open loan does not influence utilization rating. If the OP does have an open loan at a high B/L ratio, it might affect rating.

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There's no very-good/exceptional rating for revolving accounts alone.  The rating in question is for "Amount of Debt." This accounts for 30% of the Fico 8 score and it includes Aggregate B/L on open installment loans.  As an aside, SSL points are awarded under this category. 

There is no such thing as having an "exceptional" rating on revolving utilization. Doesn't exist for Fico.

[Patient957]

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@BrutalBodyShots wrote:

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@Joeychgo wrote:

My utilization is at 1% -- and it only says very good -- what does it take to get exceptional??

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First thing, be aware that those arbitrary ratings don't actually matter / no lender looks at those fluff terms when making a lending decision.

To answer your question though, it's because that the "Amount of Debt" metric still presents an opportunity to you. As one example, if you don't have an open installment loan you're missing out on the installment loan utilization boost to your FICO scores. The summary software could consider that as something keeping you from "exceptional" as far as an arbitrary rating goes.

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This.

[Thomas_Thumb]

I have no open loans. I checked my category ratings on Discover and MyFico. Discover does not list category ingredients but MyFico does. Below are the results:

Discover Scorecard:

Total Accounts - VG

Length of Credit - E

Inquiries -E

Revolving UT - VG

Missed payments - E

MyFico report:

Mix - VG

Length - E

New Credit - E

Amount of Debt - VG

Payment History - E

Both summaries list a total balance of $1807, 2% utilization and 4 accounts (all cards) with balances.

The ingredients Fico lists for amount of debt in my summary are:

1. Total balance owed. It then mentions my total balance for revolving and open ended accounts is $1807.

2. How many accounts have balances. I have 4.

3. How much available credit you are using. My revolving UT is listed at 2%.

Can't say for sure why my amount of debt/revolving UT category rates VG. I have always attributed it to reporting too many cards with balances.

[Thomas_Thumb]

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@Patient957 wrote:

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@Thomas_Thumb wrote:

Installment loans help the mix rating and an open loan can be beneficial to credit score. However, lack of an open loan does not influence utilization rating. If the OP does have an open loan at a high B/L ratio, it might affect rating.

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There's no very-good/exceptional rating for revolving accounts alone.  The rating in question is for "Amount of Debt." This accounts for 30% of the Fico 8 score and it includes Aggregate B/L on open installment loans.  As an aside, SSL points are awarded under this category. 

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Yes, I'm aware that Fico's category is amount of debt and that it includes installment loans. Thus the subsequent comment on high B/L. I should have used the term "amount of debt". Other places, such as Discover Scorecard, list revolving utilization as a category in lieu of amount of debt. 

In any event both Discover and Fico rate my file as VG in their respective category that includes revolving utilization. A deeper dive looking at past months with fewer cards reporting shows the same VG rating. It's looking like lack of an open loan might be the reason for my VG in this category.