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BobWang

The Master How to Tweak Utilization for Maximum FICO Effect Thread

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For most profiles, FICO scores are best when utilization is ~1%,
NOT 0%.
I repeat, NOT 0%.

What is reported to CRAs is the key.
Issuers USUALLY report statement balance a few days after statements close.
Some issuers may report at odd times, like End Of Month.

The goal is to get that reported utilization down to ~1%.
It may take some experimentation to find out what is actually reported, and when it happens.

If you are obsessive about FICO scores, as some un-named CBers are suspected of being,
A good strategy is to have $0.00 balances on all cards EXCEPT for one.
Choose a card that has reported reliably and predictably in the past.

Once statements close, that ~1% balance has to be paid, don’t forget to do that.
Whatever happened before statements close has no bearing on that ~1% being due in 25-30 days.
To avoid interest charges, that statement balance has to be paid before the due date.

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Absolutely, 0 Util drops your FICO as does 5% or more. The oft suggested 10% is just so wrong.

 

The other factor is number of cards with balances. When I had a util of 1% but all my cards reporting small balances my FICO took a >50 point drop once my oldest loc reached 4 years, apparently rebucket effects. However, reducing the number of locs reporting a balance from 4 to 1 recovered the FICO drop. Don;t know why number of cards had this big an impact when it had little affect when my accounts were 1 month younger. Haven't been able to find any info on how FICO buckets are broken out on clean CRs.At the same time my FICO dropped dlike a rock my Vantage score went up. Go figure.

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Ah yes, # of cards with balances definitely affects FICO too:

I swear this one hits me harder than UTL%.

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So,, wheres the gridwork on the effects of carrying balances across accounts ?

 

Im still trying to decifer your graphs Bob.W

Edited by Credit Mama

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For most profiles, FICO scores are best when utilization is ~1%,

NOT 0%.

I repeat, NOT 0%.

 

If you are obsessive about FICO scores, as some un-named CBers are suspected of being,

 

:ph34r:

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So,, wheres the gridwork on the effects of carrying balances across accounts ?

 

Im still trying to decifer your graphs Bob.W

 

FICO doesn't care whether the balance is PIF'd or carried month-to-month.

 

FICO really only cares about the Utilization percentage, a little about the absolute amount of the balance, but only a little.

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For most profiles, FICO scores are best when utilization is ~1%,

NOT 0%.

I repeat, NOT 0%.

 

If you are obsessive about FICO scores, as some un-named CBers are suspected of being,

 

:ph34r:

 

Motion to dismiss is denied. :grin:

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For most profiles, FICO scores are best when utilization is ~1%,

NOT 0%.

I repeat, NOT 0%.

 

What is reported to CRAs is the key.

Issuers USUALLY report statement balance a few days after statements close.

Some issuers may report at odd times, like End Of Month.

 

The goal is to get that reported utilization down to ~1%.

It may take some experimentation to find out what is actually reported, and when it happens.

 

If you are obsessive about FICO scores, as some un-named CBers are suspected of being,

A good strategy is to have $0.00 balances on all cards EXCEPT for one.

Choose a card that has reported reliably and predictably in the past.

 

Once statements close, that ~1% balance has to be paid, don’t forget to do that.

Whatever happened before statements close has no bearing on that ~1% being due in 25-30 days.

To avoid interest charges, that statement balance has to be paid before the due date.

<- obsessed :rofl:

 

Question though Bob.

 

According to most monitoring services, 1% for all purposes is $1.00. Even if you have 5K in credit. Does Fico agree? I have let Navy report just 1.00 and USAA shows that 1.00 as 1%. So is the 1.00 ok for the 1% factor, or does it need to be a literal 1% of all revolving credit lines?

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hr, ANYTHING above $0.00 counts as 1%.

 

If a card issuer will report a $0.01 balance, that counts.

 

SOME issuers, like Citi will report $1.00 as $0.00 to Equifax.

 

So, I let $2.00 report on my Citi Forward to avoid the NO BALANCES hit.

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Ok, that is what I have been doing - assuming the 1-2.00 counts as 1%. Thanks Bob!

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That explains it. I have six cards with small balances right now, it didn't seem to do anything to my scores.

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Bob, not too long ago below 30% was all the rave within the articles and guru publications. Now thru CB we learn you slowly creep down after 5% - how come you think this isn't mainstream? Creditors do not want it out to prevent people from carrying balances?

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That explains it. I have six cards with small balances right now, it didn't seem to do anything to my scores.

Nope, I've been given the "too many cards with balances" denial in the past, when one card had $5.00 and another had $20.00. Now years later I know why.

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That explains it. I have six cards with small balances right now, it didn't seem to do anything to my scores.

Nope, I've been given the "too many cards with balances" denial in the past, when one card had $5.00 and another had $20.00. Now years later I know why.

Oh yeah, I'm not saying I couldn't get denied for it if I applied for something. Just that it didn't seem to drop my FICO scores.

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I think the reason low utilization is not emphasized is because of good intentions.

 

Most people who carry balances CANNOT realistically get their utilizations down to 1%.

 

Most Americans probably have an idea of what their ideal weight should be, but a lot are 20% over, or more.

 

So, we don't talk about the ideal, because that may make people feel bad that they're not doing the right thing.

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That explains it. I have six cards with small balances right now, it didn't seem to do anything to my scores.

Nope, I've been given the "too many cards with balances" denial in the past, when one card had $5.00 and another had $20.00. Now years later I know why.

Oh yeah, I'm not saying I couldn't get denied for it if I applied for something. Just that it didn't seem to drop my FICO scores.

I got ya, misread it- I thought you were saying it does nothing positive for ya. Youre saying it doesnt affect you.

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I think the reason low utilization is not emphasized is because of good intentions.

 

Most people who carry balances CANNOT realistically get their utilizations down to 1%.

 

Most Americans probably have an idea of what their ideal weight should be, but a lot are 20% over, or more.

 

So, we don't talk about the ideal, because that may make people feel bad that they're not doing the right thing.

Makes perfect sense.

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Folks I know in real life sometimes say things like, "I would have bought it, but there was no room on my credit card."

 

:swoon:

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That explains it. I have six cards with small balances right now, it didn't seem to do anything to my scores.

Nope, I've been given the "too many cards with balances" denial in the past, when one card had $5.00 and another had $20.00. Now years later I know why.

Oh yeah, I'm not saying I couldn't get denied for it if I applied for something. Just that it didn't seem to drop my FICO scores.

I got ya, misread it- I thought you were saying it does nothing positive for ya. Youre saying it doesnt affect you.

It doesn't affect my scores. It may well affect an application, were I to make one, but I need to chill out on those for a while. :D

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