"Revolving credit balance too high"
My credit is being affected by, among other things, "revolving credit balance too high"
it appears they like to see less than 30 percent utilization but does anyone know how that is handled with more than one credit line?
If I have two credit lines for 10k and they both have 3k balance is that more favorable than one with zero balance and one with 6k balance?
In other words, are they looking at total balance compared to total available credit or are credit bureaus looking at each individual account.
Credit utilization is one of the big factors that influences your credit score. Credit utilization is calculated by adding up your credit card balances and dividing that number by the combined total of your credit card limits.
So if you had $1,500 balances on each of two cards, and both of those cards had $5,000 limits, then you would take $3,000 and divide it by $10,000 and get a 30% credit utilization ratio.
Here's a chart to help you visualize where you should aim to be at with your credit utilization ratio:
One obvious way to improve your ratio is to pay down your balances. However, another easy way that doesn't cost you anything is to contact your credit card company and request a credit limit increase.
It's by account.
Suppose you have 2 credit cards, each with a $5000 limit, A and B.
Person 1: A is maxed at $5k, B is at $0.
Person 2: A is at 50%, $2500, and B is also at 50%, $2500.
Both have exactly $10k in credit available, both have exactly $5000 in debt.
But person 2 will have a better FICO score than person 1. Person 2 would have about a 725, person 1 would have about a 680 (assuming everything else is identical on their two credit reports).
If person 3 had 5 credit cards, each 2+ years old, and had that $5k spread across them with 5 credit cards each individually at 20% of their limits, they would have a better FICO score than persons 2 or 1. 800+ range.
FICO score treats their algorithms as a trade secret that I'm not privy to, the above is just based on me looking at a LOT of credit reports...
