There's util based on open, active revolvers and util based on all (open and closed) revolvers. I believe Experian is the only one that actually breaks down both categories on ypur report - but all 3 bureaus consider total util in scoring. Charge off accounts with a balance, while closed, is still a debt and is therefore considered as part of your utilization until paid - affecting your scores.
You should pay or settle the debt. Leaving the balance outstanding opens you up to more score damage as the creditor may choose to update the account with additional negative marks on either a monthly or periodic basis - preventing your scores from recovering. The creditor may also sell the debt to a collection agency resulting in a collection tradeline being placed on your reports in addition to the original chargeoff tradeline. The creditor may also decide to sue you if the debt is still with the statute of limitations for your state.
Paying it will prompt the creditor to update the account to paid with a zero balance, eliminating that additional utilization and future negative updating. It will also prevent collections and/or a lawsuit.
@Anonymous wrote:Experian and all CRAs show me at 2% UTIL, which is correct based on about a $50 balance over $2500 total credit available (4 revolving accounts). However, they also show an alert that I'm "heavily using my available credit", at 28%. I finally figured out that they are including a $906 charged off, closed account, in that 28% calc. So, one, how can they show two different UTILs on the same report, and two, why would the calc even include the CO amount when that is not AVAILABLE credit. You can't have available credit on a closed account. By definition, it is NOT available. Thanks for any insights.
Although the credit limit is no longer available to you, the balance you owe is still owed by you.
@SouthJamaica wrote:
@Anonymous wrote:Experian and all CRAs show me at 2% UTIL, which is correct based on about a $50 balance over $2500 total credit available (4 revolving accounts). However, they also show an alert that I'm "heavily using my available credit", at 28%. I finally figured out that they are including a $906 charged off, closed account, in that 28% calc. So, one, how can they show two different UTILs on the same report, and two, why would the calc even include the CO amount when that is not AVAILABLE credit. You can't have available credit on a closed account. By definition, it is NOT available. Thanks for any insights.
Although the credit limit is no longer available to you, the balance you owe is still owed by you.
But it literally says "of your available credit". As you point out, that credit is no longer available to me. So while it is a debt, it is not available credit. Closed accounts have no available credit. I just closed an account with a $300 limit and my available credit also dropped $300 because that credit is no longer available to me. The balance is a debt, not available credit. It should factor in to my total collections and ding me there, which it does, but not to utilization of my available credit. From Experian's own site: "Your credit utilization rate, sometimes called your credit utilization ratio, is the amount of revolving credit you're currently using divided by the total amount of revolving credit you have available." Closed account = not available. I have filed a support ticket with Experian and will duke it out with them, lol. The rep I talked to agreed with me and filed the ticket for me. Wish me luck! 
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@Anonymous wrote:
@SouthJamaica wrote:
@Anonymous wrote:Experian and all CRAs show me at 2% UTIL, which is correct based on about a $50 balance over $2500 total credit available (4 revolving accounts). However, they also show an alert that I'm "heavily using my available credit", at 28%. I finally figured out that they are including a $906 charged off, closed account, in that 28% calc. So, one, how can they show two different UTILs on the same report, and two, why would the calc even include the CO amount when that is not AVAILABLE credit. You can't have available credit on a closed account. By definition, it is NOT available. Thanks for any insights.
Although the credit limit is no longer available to you, the balance you owe is still owed by you.
But it literally says "of your available credit". As you point out, that credit is no longer available to me. So while it is a debt, it is not available credit. Closed accounts have no available credit. I just closed an account with a $300 limit and my available credit also dropped $300 because that credit is no longer available to me. The balance is a debt, not available credit. It should factor in to my total collections and ding me there, which it does, but not to utilization of my available credit. From Experian's own site: "Your credit utilization rate, sometimes called your credit utilization ratio, is the amount of revolving credit you're currently using divided by the total amount of revolving credit you have available." Closed account = not available. I have filed a support ticket with Experian and will duke it out with them, lol. The rep I talked to agreed with me and filed the ticket for me. Wish me luck!
You're absolutely wasting your time trying to dispute this with experian.
Your utilization is your total amount of revolving debt / total available limit.
So this unpaid chargeoff is included in your amount of revolving debt. The limit on the chargeoff is nonexistent - it is, essentially, $0. Therefore, the original card limit is not included in the available credit portion of the above equation.
This is how scoring works and it works this way for all three bureaus. Just because the fluff software for EQ and TU doesn't break it down transparently like Experian does, does not mean they don't do the same when calculating your score - they do.
You should read more in the Understanding Fico Scoring section.
@thornback wrote:
@Anonymous wrote:
@SouthJamaica wrote:
@Anonymous wrote:Experian and all CRAs show me at 2% UTIL, which is correct based on about a $50 balance over $2500 total credit available (4 revolving accounts). However, they also show an alert that I'm "heavily using my available credit", at 28%. I finally figured out that they are including a $906 charged off, closed account, in that 28% calc. So, one, how can they show two different UTILs on the same report, and two, why would the calc even include the CO amount when that is not AVAILABLE credit. You can't have available credit on a closed account. By definition, it is NOT available. Thanks for any insights.
Although the credit limit is no longer available to you, the balance you owe is still owed by you.
But it literally says "of your available credit". As you point out, that credit is no longer available to me. So while it is a debt, it is not available credit. Closed accounts have no available credit. I just closed an account with a $300 limit and my available credit also dropped $300 because that credit is no longer available to me. The balance is a debt, not available credit. It should factor in to my total collections and ding me there, which it does, but not to utilization of my available credit. From Experian's own site: "Your credit utilization rate, sometimes called your credit utilization ratio, is the amount of revolving credit you're currently using divided by the total amount of revolving credit you have available." Closed account = not available. I have filed a support ticket with Experian and will duke it out with them, lol. The rep I talked to agreed with me and filed the ticket for me. Wish me luck!
You're absolutely wasting your time trying to dispute this with experian.
Your utilization is your total amount of revolving debt / total available limit.
So this unpaid chargeoff is included in your amount of revolving debt. The limit on the chargeoff is nonexistent - it is, essentially, $0. Therefore, the original card limit is not included in the available credit portion of the above equation.
This is how scoring works and it works this way for all three bureaus. Just because the fluff software for EQ and TU doesn't break it down transparently like Experian does, does not mean they don't do the same when calculating your score - they do.
You should read more in the Understanding Fico Scoring section.
@thornback wrote:
@Anonymous wrote:
@SouthJamaica wrote:
@Anonymous wrote:Experian and all CRAs show me at 2% UTIL, which is correct based on about a $50 balance over $2500 total credit available (4 revolving accounts). However, they also show an alert that I'm "heavily using my available credit", at 28%. I finally figured out that they are including a $906 charged off, closed account, in that 28% calc. So, one, how can they show two different UTILs on the same report, and two, why would the calc even include the CO amount when that is not AVAILABLE credit. You can't have available credit on a closed account. By definition, it is NOT available. Thanks for any insights.
Although the credit limit is no longer available to you, the balance you owe is still owed by you.
But it literally says "of your available credit". As you point out, that credit is no longer available to me. So while it is a debt, it is not available credit. Closed accounts have no available credit. I just closed an account with a $300 limit and my available credit also dropped $300 because that credit is no longer available to me. The balance is a debt, not available credit. It should factor in to my total collections and ding me there, which it does, but not to utilization of my available credit. From Experian's own site: "Your credit utilization rate, sometimes called your credit utilization ratio, is the amount of revolving credit you're currently using divided by the total amount of revolving credit you have available." Closed account = not available. I have filed a support ticket with Experian and will duke it out with them, lol. The rep I talked to agreed with me and filed the ticket for me. Wish me luck!
You're absolutely wasting your time trying to dispute this with experian.
Your utilization is your total amount of revolving debt / total available limit.
So this unpaid chargeoff is included in your amount of revolving debt. The limit on the chargeoff is nonexistent - it is, essentially, $0. Therefore, the original card limit is not included in the available credit portion of the above equation.
This is how scoring works and it works this way for all three bureaus. Just because the fluff software for EQ and TU doesn't break it down transparently like Experian does, does not mean they don't do the same when calculating your score - they do.
You should read more in the Understanding Fico Scoring section.
I hear you and thanks for the additional explanation. However, the original credit limit on the account IS being added to my total available credit. Actual available credit is $2500 and this closed account is $900. Adding my actual credit used ($50) to the closed account balance ($900) is $950. Inflated credit used of $950 / inflated available credit of $3400 is the 28% Experian is showing. I will absolutely read up more on scoring, but those numbers are clear, and I will for sure report back when I go round 2 with Experian .
