Lowering Your Open Credit Card Utilization Questions

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Dylan1982
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Lowering Your Open Credit Card Utilization Questions

Postby Dylan1982 » Wed Mar 07, 2012 12:45 am

My Utilization is at 59% right now :(

What's a good way to lower that down?

Obviously the best way would be to pay off your balance each month. But would also asking for a credit line increase, would that help bring it down as well?

Here's how my utilization is broken down: CC Limit / Balance Owed


**CC Company has not updated their records this month yet

GM Card: $7,700 / **$7,416 (made an $85 payment not yet reflected)

Best Buy: $1,600 / **$1,079 (Paid this balance in full in Feb. not yet reflected)

Discount Tires: $1,000 / $0

Rodgers & Hollands: $3,250 / $0

Express: $900 / $0


My debt is $8,495 and my limits added up are $14,450. Making my Utilization 59%

Now if you update the financial info for the cards with the asterik it would look like this.

**My debt is $7,331 and my limits added up are $14,450. Making my Utilization 51%**

So what would be a good way to lower my utilizatiion?
Chase Freedom - $12,500 (2/2013)
GM Card - $7,700 (7/2002)
CitiBank (Thank You Preferred) - $6,400 (6/2012)
CitiBank (Diamond Preferred) - $4,600 (6/2012)
Rogers & Hollands - $3,300 (3/2006)
Target REDcard - $3,000 (11/2014)
BestBuy - $1,600 (9/2003)
Discount Tires - $1,000 (2/2004)
Kohl's - $300 (4/2012)


namvet
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Postby namvet » Wed Mar 07, 2012 11:30 am

Only way to lower util is to pay down balances and/or increase your credit limits.

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PlatinumAMEX94
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Postby PlatinumAMEX94 » Wed Mar 07, 2012 12:02 pm

Your utilization shows 96% for one card. If I were you I would open a Citibank and transfer half of that off your GM card. It is not usually a good idea to carry all your debt with one bank, in my opinion. It is also a good idea to have more than one major credit card. What if you had a car problem or hospitalization? You don't have any available credit to absorb those emergencies, which is one reason many people have credit cards. I know when I was younger a blown transmission was not something I could easily drop a few thousand dollars to fix.

And as many people would probably agree, having those reserve credit lines are for those "emergencies". I can remember many times thinking or saying, "That's what credit cards are for ... to pay for _____ when you really need it but can't afford it." And I am not talking stuff you buy at the mall, but your hot water heater blowing up, or your furnace going out, or a new transmission.
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Postby Crashem » Fri Mar 09, 2012 9:41 am

I would also pay attention to when your cards report to the bureaus on your balances. For example, my AMEX reports on the day they generate a statement which makes it look like I always run a balance with them. On the other hand, my credit card reports on the due date which means my balance usually looks like 0. If I needed to get my utilization down, I would just pay my AMEX a few days before the statement is generated to get the number down.
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Dylan1982
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Postby Dylan1982 » Fri Mar 09, 2012 7:38 pm

PlatinumAMEX94 wrote:Your utilization shows 96% for one card. If I were you I would open a Citibank and transfer half of that off your GM card. It is not usually a good idea to carry all your debt with one bank, in my opinion. It is also a good idea to have more than one major credit card. What if you had a car problem or hospitalization? You don't have any available credit to absorb those emergencies, which is one reason many people have credit cards. I know when I was younger a blown transmission was not something I could easily drop a few thousand dollars to fix.

And as many people would probably agree, having those reserve credit lines are for those "emergencies". I can remember many times thinking or saying, "That's what credit cards are for ... to pay for _____ when you really need it but can't afford it." And I am not talking stuff you buy at the mall, but your hot water heater blowing up, or your furnace going out, or a new transmission.

Yes you're correct, my utilization for the GM Card is 96% :(

Which Citi Bank card are you referring to, to transfer half my balance? And like you said, I have only one major cc and could use another major cc company to my history.

If doing another cc, will that be a soft hit or a hard hit on my credit report?

Thanks for your help!
Chase Freedom - $12,500 (2/2013)
GM Card - $7,700 (7/2002)
CitiBank (Thank You Preferred) - $6,400 (6/2012)
CitiBank (Diamond Preferred) - $4,600 (6/2012)
Rogers & Hollands - $3,300 (3/2006)
Target REDcard - $3,000 (11/2014)
BestBuy - $1,600 (9/2003)
Discount Tires - $1,000 (2/2004)
Kohl's - $300 (4/2012)

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PlatinumAMEX94
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Postby PlatinumAMEX94 » Sat Mar 10, 2012 1:40 am

I believe the Thank You or Simplicity have the best rates for transfer. Yes, you should transfer half of that balance. It will be a hard inquiry to your credit report.

You're welcome. :)
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Dylan1982
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Postby Dylan1982 » Fri Jun 29, 2012 8:28 pm

Just wanted to give an update..

I had to get a Personal Loan on 6/27/2012 of $1,500, my credit union pulled my score with TransUnion. My score came up at 676 (B), and an A with TransUnion is 680. So I was oly 4 points away from being an A. And according to Credit Karma I'm at a 698 (C).

I checked my Credit Karma score today and it was at 695. Also today I opened up 2 Citibank Cards; Thank You Preferred and Diamond Preferred both of them gave me a CL of 2 @ $4,600 (total of $9,200)

So I hurt my credit score with the 2 hard inquiries, but at the same time I helped my credit score by adding more credit thus lowering my overall utilization.
Chase Freedom - $12,500 (2/2013)
GM Card - $7,700 (7/2002)
CitiBank (Thank You Preferred) - $6,400 (6/2012)
CitiBank (Diamond Preferred) - $4,600 (6/2012)
Rogers & Hollands - $3,300 (3/2006)
Target REDcard - $3,000 (11/2014)
BestBuy - $1,600 (9/2003)
Discount Tires - $1,000 (2/2004)
Kohl's - $300 (4/2012)

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Postby DavidNY » Fri Jun 29, 2012 8:34 pm

Congrats! Now move the balances with the highest APRs :-)



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