I would like to improve my credit score^ by throwing money at it rather than by waiting several more years for a ding to disappear from it.

I've read several good questions and answers here about using cash (e.g. with a secured credit card) to increase one's credit score, but I haven't seen any discussion about the limitations of such an approach.

1) Is the credit utilization component of the credit score purely a ratio as described in this article, or is any attention paid to the absolute dollar amount of unused credit?

2) If the answer to (1) is that it's purely a ratio, then how far from 0% utilization can I be before my credit score loses points? U=5%? U=1%?

3) Suppose the answer to (2) is 1%, such that if U=1.0% I lose P points, but if U=0.9% I lose nothing. Then suppose that I typically put $1000 onto my credit cards each month and that my total credit limit across all cards is $10K. So currently my U=10%. Can I simply go to a bank and open a secured credit card on $91K collateral? That would bring my U down to

1,000 / 101,000 = 0.99%

and maximize the utilization portion of my score.


Now, Googling yields this survey from 2011 that indicates $30K was by far the upper limit for a secured credit card then. Other websites seem to agree that $10K is about the best I could do nowadays.

4) Why do such limits exist? Since I have to pony up the collateral in advance, why can't I get any credit limit I want? What is the risk that the financial institution fears?

5) Assuming that those limits for secured credit cards are real and non-negotiable, is there another form of fully-collateralized credit that I can establish with a financial institution and is reported to credit bureaus as a revolving loan? How about as an installment loan? Given that there's such a thing as a home equity line of credit, and a home is (literally) infinitely harder to turn into dollars than cash is, shouldn't I be able to establish a cash line of credit just as easily? Are there any institutions known for a willingness to custom-build products like these for clients?


^ For the purposes of this question, by credit score I simply mean the "typical" or "average" FICO-style score.

closed as too broad by Dheer, Victor, mhoran_psprep, JoeTaxpayer Nov 25 '15 at 13:48

Please edit the question to limit it to a specific problem with enough detail to identify an adequate answer. Avoid asking multiple distinct questions at once. See the How to Ask page for help clarifying this question. If this question can be reworded to fit the rules in the help center, please edit the question.

  • Keep in mind that your fico is largely based on the length of your credit history, not just your debt:income ratio. Also, credit cards are of the bottom tier of affecting your fico. Different lines of credit are weighted differently - example of the three common tiers being (1) mortgage, (2) car loan, (3) credit card. This is because any schmuck can win the lottery (or similar) and appear to be responsible for a few months .. – MrDuk May 29 '15 at 20:12
  • It's difficult for anyone to provide advice without knowing your current credit score and seeing your credit reports. Basically, pay off all your debt except mortgage and car. Stay up to date on everything else. Use a credit card but pay it off every month. – ssaltman May 29 '15 at 20:58
  • Given the length of my question, please consider limiting yourselves to on-topic comments only, as otherwise the comments will get pretty long! (On-topic comments are defined as those that have to do with the questions I outlined in the post.) – dg99 May 29 '15 at 21:05
  • You'll get more answers sooner if you break this up into separate questions. As it stands, it's likely to be returned to you for editing. – keshlam May 29 '15 at 21:18
  • Have you read the multiple post here that discuss utilization? If you think 0% is ideal, please start reading. – JoeTaxpayer May 29 '15 at 21:36