How will my credit score be affected by a large purchase that raises my utilization if I pay it in full?
My Fiance and I realized that we need to start looking for homes and need to be pre-approved for a home loan. My fiance has better credit then I do, but mine is in good standing.
We want to make sure we get the best interest rate. I just purchased an item on my credit card that would show as 64% utilization for the credit card. This purchase was made 3 weeks ago, and we are paying one item in full this week which would bring credit card utilization down to 10%. Do we need to wait a full cycle for that to be represented in our credit pull?
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From my understanding, having a low utilization on your credit card limits helps your credit score so ask your credit card company for a higher limit and pay off your balances as quickly as you can, preferably before you are required to
DISCLAIMER: Assuming US
Your credit scores will reflect your payment history and utilization history better than any utilization snapshot.
If the credit card is only in your name (not a joint account), the short term utilization will not affect your fiance's credit score.
When making a joint application for a mortgage, all of your scores are pulled, and your middle score is compared to your wife's middle score, and the lowest of the two is taken into consideration for your mortgage qualification.
If that's your only credit card, it may have a significant effect on your credit score, but if it's one of a few cards that you have available, the higher utilization on that one account can be largely offset by a low overall utilization from combining all of your cards.
If I'm not mistaken, the balance/utilization that is reported on a pulled credit report is whatever was on your last credit card statement.
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