Credit Score Question

[bjl584]

Does anyone know what this means?

"Total account balances are too high in proportion to credit limits"

All 3 credit reporting agencies report this same issue as one of the factors affecting my score.

I thought maybe they are referring to me using too much of my available credit, but I never charge more than 3% to 5% of my available credit, and I always pay off the bill in full every month and never carry a balance. So, I'm not sure what they are saying.

My score is just under 800 anyway. I'm just curious if anyone knows what the credit agencies are saying here.

[Wino]

Do you have an Amex or other charge card? Note that these are NOT credit cards. They are accounts due at the end of the month in full, every month. This type of card usually lists your highest historical balance as your credit limit. If you have only charged $1000 in a month, yet you do it every month, then you're using 100% of the limit.

Secondly, if you have a closed account with a balance, it will show as a high balance.

Lastly, the credit agencies really don't care about you or your credit. They are in the data business, and their customers are those who pay regularly for credit information. I know that my report shows a card with zero balance, but with a minimum payment of $25. It probably affects my credit score, but I don't care. My score is plenty high enough for anything I need from it such as loans and auto insurance levels. The rest of the impact of the number is all psychological.

[sherylgray]

It means the sum of all credit limits, and account balance is more than the available credit to get approval for any transaction.

[kv968]

Does anyone know what this means?

"Total account balances are too high in proportion to credit limits"

All 3 credit reporting agencies report this same issue as one of the factors affecting my score.

Do you have a mortgage? Maybe they're figuring that into your overall score and not just the revolving credit aspect of it.

I always get a couple of these "negatives" at the end of my credit report too and I wonder if some of them are just arbitrarily put there since some of mine don't really make sense either. One of the "key factors affecting my score" was "the credit line on revolving accounts". I don't go over 15-20% of my available credit so why do I need a higher credit limit? I could get an increase but then I'm sure the next time I run a report one of the "negatives" would be that I "increased credit limits".

Like you, my score is just below 800 so I don't really pay much attention to it. I think they just have to put some "recommendations" out there and they just go with the biggest "problems" you have even if they really aren't truly problems.

[MonkeyMama]

Sorry if someone mentioned already, but I didn't see it mentioned - it could just be that one of your credit cards is not reporting the credit limit? So the credit bureaus are assuming the limit is $0?

I had a credit card that did not report the limit, but I never bothered to look into it further since my score was 800+. (I have since closed the card, so I have no more "$0-limit cards" on my reports).

[thesimplemoneyblog]

Yeah, it seems kind of meaningless when they don't actually give you more information for what they actually mean. Since your credit score is so high, there's really not much more you should be doing or anything in particular you could be doing differently that would make a difference.