What is Credit Card Utilization Based On?
Author: USMC93
Posted: Sat Mar 17, 2007 1:20 pm
Post subject: Utilization?
I have been trying to figure out if utilization is based off of just the current cards your using or if it's based off of the total amount available to you through all your cards. I'm not sure that I fully understand this. Do i not want to use more than 30% on a single card or do I not want to use more than 30% of what I have available?
Also if you have cards that are just sitting in a sock drawer do those limits count or do you have to use the cards for them to be considered in your grand scheme of it all?
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Author: direred
Posted: Sat Mar 17, 2007 2:18 pm
Post subject:
Both count against you, so yes to both.
Author: USMC93
Posted: Sat Mar 17, 2007 2:52 pm
Post subject:
So then if I have a card with a 10K limit and have one being used with a 10K limit then the one being used has a balance of 5K then it would be viewed as 20K with a 5k of it being utilized in the bigger picture?
Sorry to keep hounding the point I'm just trying get an idea of how this all is suppose to work.
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Author: artcubed
Posted: Sat Mar 17, 2007 2:53 pm
Post subject:
Yup, both count. I was denied for a card once because "card accounts have high balances in relation to their credit limits"
Turns out that my overall utilization was around 10%, but on one card, utilization was over 80% (a Chase card with a $300 limit....grrr)
To answer the above question, yes your overall utilization would be 25%, but you could have a problem with that one card having 50% utilization.
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Author: USMC93
Posted: Sat Mar 17, 2007 3:03 pm
Post subject:
artcubed,
that info was exactly what I was looking for. They look at the overall and individual as well. So if you have to at 50% but overall are at like 25% then it can still hurt.
Thank you!
Author: hdporter
Posted: Sat Mar 17, 2007 9:47 pm
Post subject:
USMC93 wrote:
that info was exactly what I was looking for. They look at the overall and individual as well. So if you have to at 50% but overall are at like 25% then it can still hurt.
I'll suggest, based upon my experience, that utilization on individual accounts is a far greater factor than overall utilization. (Of course, if overall utilization is high, then you can imagine that at least one or two accounts will have sky high utilization.)
Anytime just one of my accounts (out of 10+ active accounts with balances) rose to 50%+ utilization, the impact on my score has been marked. Keeping all accounts to within 30% is best.
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Posted: Sat Mar 17, 2007 1:20 pm
Post subject: Utilization?
I have been trying to figure out if utilization is based off of just the current cards your using or if it's based off of the total amount available to you through all your cards. I'm not sure that I fully understand this. Do i not want to use more than 30% on a single card or do I not want to use more than 30% of what I have available?
Also if you have cards that are just sitting in a sock drawer do those limits count or do you have to use the cards for them to be considered in your grand scheme of it all?
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Author: direred
Posted: Sat Mar 17, 2007 2:18 pm
Post subject:
Both count against you, so yes to both.
Author: USMC93
Posted: Sat Mar 17, 2007 2:52 pm
Post subject:
So then if I have a card with a 10K limit and have one being used with a 10K limit then the one being used has a balance of 5K then it would be viewed as 20K with a 5k of it being utilized in the bigger picture?
Sorry to keep hounding the point I'm just trying get an idea of how this all is suppose to work.
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Author: artcubed
Posted: Sat Mar 17, 2007 2:53 pm
Post subject:
Yup, both count. I was denied for a card once because "card accounts have high balances in relation to their credit limits"
Turns out that my overall utilization was around 10%, but on one card, utilization was over 80% (a Chase card with a $300 limit....grrr)
To answer the above question, yes your overall utilization would be 25%, but you could have a problem with that one card having 50% utilization.
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Author: USMC93
Posted: Sat Mar 17, 2007 3:03 pm
Post subject:
artcubed,
that info was exactly what I was looking for. They look at the overall and individual as well. So if you have to at 50% but overall are at like 25% then it can still hurt.
Thank you!
Author: hdporter
Posted: Sat Mar 17, 2007 9:47 pm
Post subject:
USMC93 wrote:
that info was exactly what I was looking for. They look at the overall and individual as well. So if you have to at 50% but overall are at like 25% then it can still hurt.
I'll suggest, based upon my experience, that utilization on individual accounts is a far greater factor than overall utilization. (Of course, if overall utilization is high, then you can imagine that at least one or two accounts will have sky high utilization.)
Anytime just one of my accounts (out of 10+ active accounts with balances) rose to 50%+ utilization, the impact on my score has been marked. Keeping all accounts to within 30% is best.
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Labels: Overall Credit Card Utilization, Utilization on Individual Credit Card Accounts
posted by CardRatings.com at 12:35 AM
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