Too Many Accounts With Balances

[BeachDweller]

Decided to check FICO scores on Equifax after adding three new trade lines, two with American Express and one with Navy Federal Credit Union. My score dropped about 50 points, but the surprise was that one indicator was, "too many accounts with balances." The utilization was below six percent, but they didn't like that I had used the cards evenly. Just thought I would let folks know. Might be time to sock drawer all the cards but one a month.

[Roland99]

yeah...more than 50% of cards carrying a balance is a hit to the score.

 

I can't wait for my Navy Visa to report...4 BTs to them (and 2 BTs to my new Discover) will leave me with 4 accounts with a balance and 13 without.

[ArchonInitiative]

This is good info to know. In your case, that was worth 50 points. It may be an even bigger jump for me if I get a few cards at zero balance.

[BeachDweller]

I will remember half the cards. Darndest thing is two of the cards had balances less than $20. I just wanted to use them; now they will be rotated.

[goldtrad]

Actually a lot depends upon your individual report. I have 6 open accounts in total all credit cards. My EQ scores are 795 with 1 reporting a balance 792 with 2 and 783 with 0 reporting a balance.

[VK]

I will remember half the cards. Darndest thing is two of the cards had balances less than $20. I just wanted to use them; now they will be rotated.

 

BD,

 

You can still use all the cards...just make sure, if you are worried about FICO score, to prepay to $0 before the statement cuts or before CC company reports balances to FICO (most report when the statement is cut, but there are exceptions).

 

VK

[BeachDweller]

I will remember half the cards. Darndest thing is two of the cards had balances less than $20. I just wanted to use them; now they will be rotated.

 

BD,

 

You can still use all the cards...just make sure, if you are worried about FICO score, to prepay to $0 before the statement cuts or before CC company reports balances to FICO (most report when the statement is cut, but there are exceptions).

 

VK

Thank you. I will primarily use American Express charge and the Navy Federal Flagship from now on....the rest can just sit there. I will pay off the Navy Federal before the statement cuts.

[The Livid One]

This is good info to know. In your case, that was worth 50 points. It may be an even bigger jump for me if I get a few cards at zero balance.

 

It's always nice to know that we are able to manipulate the scores and get our points back. Paying down the balances is a nice tactic with multiple benefits.

 

Maybe they lend the points to Bob Wang for the month and then you get them back... :wave:

[wanabe]

Decided to check FICO scores on Equifax after adding three new trade lines, two with American Express and one with Navy Federal Credit Union. My score dropped about 50 points, but the surprise was that one indicator was, "too many accounts with balances." The utilization was below six percent, but they didn't like that I had used the cards evenly. Just thought I would let folks know. Might be time to sock drawer all the cards but one a month.

 

How many CC did you have reporting a balance?

I have had 6 to 7 CC reporting a balance out of 21

for a few months due to 3 with BT's and the others

are rotating showing balances every 6 to 7 months.

I don't see being able to show less than that until

I finish the BT's and close some of my CC to not have

to rotate unused cards. I have been getting the same message

with the 6 to 7 showing bal. and still am under 40% of cards showing bal.

[BeachDweller]

I only have four cards, an Delta Gold American Express, a Premier Rewards American Express Gold charge card, a PNC Rewards card, and a Navy Federal Credit Union Flagship VISA Signature. All had a balance, but one of them had less than $20. The PNC card had about $900 out of $15,000, and the NFCU had about $150 out of $20,000. The Amex Gold has a 10,000 limit and of course the Amex charge has no set limit reported. Even though I had about $1100 out of $45,000 I was dinged. The charge card had about $1800, but that is still only $2900. And the charge card supposedly doesn't count against utilization.

Edited March 24, 2011 by BeachDweller

[wanabe]

I wish I just had a few cards that I use regular.

I only use about 5 cards monthly the others are useless now to

me due to no rewards for using them. You can use all of your

cards, but for score purpose you would have to PIF before statement

close and only let 1 to 2 show a balance. I am closing 2 this year

and maybe 2 to 3 per year after that.

[xelda]

I think it may help your score to use all your cards every month but only let the balance report for 1 or 2 cards. Keep in mind, the "date of last activity" does count. I think it's possible that the more dormant you let a card go, the less it will help your score. I say this because every time I pull my FICO, it says what's helping my score is that I've made recent use of my credit.

 

I only have 12 cards. I only use 3 or 4 primarily for the rewards, but every card gets used every month. Since my cell phone bill lets me make payments with multiple cards, I just charge a few bucks to each card.

Edited March 24, 2011 by xelda

[The Livid One]

If OP has 4 cards it's easy to fall prey to "Too many accounts with balances reporting".

 

If only two of the accounts report balances then 50% of OP's accounts are utilized, three reporting would be 75%,

so until some more accounts are obtained it's likely that OP's in a bucket that factors in the amount of accounts and with so few, the more reporting balances the more it hurts.

 

All of us are affected by Fico figuring in HOW MANY accounts we have, although it hurts some more than others.

[BeachDweller]

If OP has 4 cards it's easy to fall prey to "Too many accounts with balances reporting".

 

If only two of the accounts report balances then 50% of OP's accounts are utilized, three reporting would be 75%,

so until some more accounts are obtained it's likely that OP's in a bucket that factors in the amount of accounts and with so few, the more reporting balances the more it hurts.

 

All of us are affected by Fico figuring in HOW MANY accounts we have, although it hurts some more than others.

Well I also have student loans, so five accounts total. Not sure if they factor into that equation. I have already paid all but one card early, the charge card. Hopefully, the cards will not report balances since they were paid before statements cut. We shall see.

 

I really don't have any interest in any other cards; four seems adequate to suit my needs, or as the wife says, "more than adequate."

Edited March 24, 2011 by BeachDweller

[wanabe]

I think it may help your score to use all your cards every month but only let the balance report for 1 or 2 cards. Keep in mind, the "date of last activity" does count. I think it's possible that the more dormant you let a card go, the less it will help your score. I say this because every time I pull my FICO, it says what's helping my score is that I've made recent use of my credit.

 

I only have 12 cards. I only use 3 or 4 primarily for the rewards, but every card gets used every month. Since my cell phone bill lets me make payments with multiple cards, I just charge a few bucks to each card.

 

It would really drive me crazy to use 21 CC monthly. It is hard enough

keeping up with using the dormant cards every 6 months, when the

time is right I will be closing all the cards with no rewards or no

use to use them. I still get I've made recent use of my credit because

I rotate cards showing balance and 3 CC have BT/0% that have been reporting balance every month + the 2 to 3 CC I have to rotate in is what's bothering

me and making me have too many cards showing a balance.

[xelda]

It would really drive me crazy to use 21 CC monthly. It is hard enough

keeping up with using the dormant cards every 6 months, when the

time is right I will be closing all the cards with no rewards or no

use to use them. I still get I've made recent use of my credit because

I rotate cards showing balance and 3 CC have BT/0% that have been reporting balance every month + the 2 to 3 CC I have to rotate in is what's bothering

me and making me have too many cards showing a balance.

That does sound like a lot to keep track of. I don't care about which accounts report a balance (other than my Citi Forward to get the bonus points). I have a few accounts that have never reported a balance since the opening date, but they are still current on activity.

[wanabe]

It would really drive me crazy to use 21 CC monthly. It is hard enough

keeping up with using the dormant cards every 6 months, when the

time is right I will be closing all the cards with no rewards or no

use to use them. I still get I've made recent use of my credit because

I rotate cards showing balance and 3 CC have BT/0% that have been reporting balance every month + the 2 to 3 CC I have to rotate in is what's bothering

me and making me have too many cards showing a balance.

That does sound like a lot to keep track of. I don't care about which accounts report a balance (other than my Citi Forward to get the bonus points). I have a few accounts that have never reported a balance since the opening date, but they are still current on activity.

 

I have found for me it a card goes without reporting a balance over 6 months

I tend to lose up to 7 points so far. Once I let BOA go without reporting

a balance for 13 months and I lost about 14 Pts. when it did. So to keep

the lose at a minimum I try to let each one report every 5 to 6 months.