eyeball Posted January 20, 2008 Report Share Posted January 20, 2008 Everyone here talks about cc utilization ,what is that? Also what is the correct amount of utilization on a card if you re starting out nwith bad creditThanks Link to comment Share on other sites More sharing options...
Amerikaner83 Posted January 20, 2008 Report Share Posted January 20, 2008 utilization is the percentage of your balances to credit limits. For example, you have 1K in limits, but 400 in balances. Your utilization is 40%. utilization only refers to revolving accounts...because on an installment account your available credit does not increase as the balance gets paid down (car, home, etc).Lower is better, optimal (for FICO ) is 1-9 %. Link to comment Share on other sites More sharing options...
Freak Posted January 20, 2008 Report Share Posted January 20, 2008 Utilization is the amount of your credit limit both individually and combined of all cards you are using. Normally, the way I understand it, above 30%, you're punished pretty hard, below 9% is idea. Link to comment Share on other sites More sharing options...
pointman Posted January 21, 2008 Report Share Posted January 21, 2008 Lower is better, optimal (for FICO ) is 1-9 %.I'm currently at less than 1% (0.9375) across the board and I can't wait till the end of the month to find out how my FICOs are feelin' after that steady diet of cash and online payments! Link to comment Share on other sites More sharing options...
TTigggers Posted January 21, 2008 Report Share Posted January 21, 2008 I'm currently at less than 1% (0.9375) across the board and I can't wait till the end of the month to find out how my FICOs are feelin' after that steady diet of cash and online payments!Way to go Pointman Link to comment Share on other sites More sharing options...
isislc Posted January 21, 2008 Report Share Posted January 21, 2008 Right now my utilization is kind of high but made a few big payments. Got 2 notifications from EQ and saw my score bumpted 26 points. It told me that my balances came down and lowering my utilization further would be better. Link to comment Share on other sites More sharing options...
bigdaddyroy Posted January 21, 2008 Report Share Posted January 21, 2008 Does anyone have a spreadsheet that they use with cc's and the amounts and balances? I want to put all of my stuff in one spreadsheet and see my utilization. Link to comment Share on other sites More sharing options...
fred333 Posted January 21, 2008 Report Share Posted January 21, 2008 Sorry I do not. I would look around the net for one. There has to be one in Google. Link to comment Share on other sites More sharing options...
Freak Posted January 21, 2008 Report Share Posted January 21, 2008 I made one that simply displays my utilization, both individual and total, and what a payment does to the total utilization. It also displays the interest rate. It meets my needs, but probably wouldn't anyone else's. A quick Google search turned up the following: http://www.mdmproofing.com/iym/products/debt-tracker.php. I downloaded and opened it, and it appears to do just about everything. It is freeware. Link to comment Share on other sites More sharing options...
eyeball Posted January 21, 2008 Author Report Share Posted January 21, 2008 Sorry to ask a stupid question, but if your limit is $100, than to stay under 9% youn should only charge $9.00? is that corredt? Link to comment Share on other sites More sharing options...
ctfudge&bankofC-ville Posted January 21, 2008 Report Share Posted January 21, 2008 Not a stupid question.Yeah, technically, you are correct. I know it sounds impractical, but to use your credit in the "ideal" sense, it's best to use each card (I think never using a card does not benefit you much) for just a tiny percentage of its limit and pay it off, or make payments on that tiny balance. Like if your card had a $300 limit, you'd buy less than $30 worth of stuff and pay it off in whatever small payments they offer ($11 per month or something.) I happen to feel that, whenever possible, you should carry that balance a few months, just to show them that you can make payments on something. Then again, it's better to make payments that are "more than the minimum." I know at WaMu they keep track of that and it seems like feather in your cap.In reality, I charge up hefty balances and then pay them off quickly, and it seems to result in limit increases. They just seem to love seeing a big balance come down to zero quickly. But yeah, if you're shopping for new credit, you want a potential creditor to look at your report and say, "Wow, he has credit but does not seem to need it a lot, since he has only a small percentage of his credit line being used. He looks like a good customer - I think I'll offer him a card!" Link to comment Share on other sites More sharing options...
pointman Posted January 21, 2008 Report Share Posted January 21, 2008 Sorry to ask a stupid question, but if your limit is $100, than to stay under 9% youn should only charge $9.00? is that corredt?Assuming your entire portfolio of cards totaled $100 in credit...You can charge any amount you wish up to your available limit, providing you avoid going over your limit plus triggering an over-limit fee and/or a higher APR.The trick is to pay it down to an *acceptable amount before the account is reported for the month. Since most accts report at different times of the month, you could feasibly play your cards in a manner that allows you to use them and then pay them down before they report.* Between 1-9% for instance, although 30% is the benchmark according to TrueCredit.Look at your most recent reports and check the balance on each account for "Date Reported." Each creditor will have a different date and will probably report on or near the same date next month. That will give you an idea of which card you could use and still have time to pay it down to the amount you're comfortable with. Link to comment Share on other sites More sharing options...
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