Josh from Pennsylvania had his credit pulled for a mortgage and noticed something puzzling on his report: a notation saying his score was lowered because he had “too many revolving credit cards with national banks.” He has four cards, uses three regularly, keeps his utilization around 5%, and sits in the upper 700s. Naturally, he wondered if the credit bureaus had changed the rules on him.
Clark Howard’s answer was blunt. “If you’re in the upper 700s, ignore what they put there. It’s just basically gibberish.”
Clark is right. And understanding why will save you from making a costly mistake in pursuit of a score that is already excellent.
Why Credit Report Factor Language Misleads Strong Borrowers
Every time a lender pulls your credit, the report includes a list of “reason codes” — short explanations of what factors are holding your score back. These codes are required by law, so the bureaus generate them automatically. The problem is they are ranked by relative impact, not absolute impact. Even when a factor has nearly zero effect on your final score, it still appears on the list because something has to be there.
For someone with a score in the upper 700s, the gap between their score and a perfect 850 might be 70 to 80 points. The factors listed on their report represent the marginal reasons for that gap. Having four revolving cards instead of two might cost a borrower in that range a handful of points — the kind of difference that has no bearing on whether they get approved for a mortgage or what rate they receive.
Josh’s 5% utilization is nearly optimal. Most credit experts point to keeping utilization below 30%, and under 10% is considered excellent. His card count is unremarkable. The factor language on his report is the credit scoring equivalent of a doctor telling a patient with perfect bloodwork that their vitamin D could technically be slightly higher.
The Score Range That Actually Matters for Mortgages
Mortgage lenders tier their pricing by credit score bands. A borrower in the upper 700s typically qualifies for the best available rates. With the 10-year Treasury yield currently at 4.42% and the federal funds rate sitting at 3.75%, mortgage rates are elevated relative to recent lows. Getting the best available rate matters more now than it did when rates were lower — and a score in the upper 700s already positions a borrower to capture that best rate.
Chasing a higher score by closing cards or changing behavior based on factor language could actually backfire. Closing a credit card reduces your total available credit, which raises your utilization ratio. It also shortens your average account age over time. Both of those changes can push your score down, not up — the opposite of what the anxious borrower intended.
The One Underwriter Wrinkle Worth Knowing
Clark did add one caveat worth filing away. Mortgage underwriters can sometimes request that borrowers close revolving accounts due to concerns about available credit, though Howard noted he hasn’t heard of this happening frequently. The concern is that a borrower with significant open credit lines could theoretically draw on all of them after closing, increasing their debt load.
This is a real but rare scenario. If an underwriter raises it, the conversation happens during the loan process — it is not something to preemptively act on. And with a score like Josh’s, Howard described it as “so sky high” that he wouldn’t expect the issue to come up at all.
What Borrowers in Josh’s Position Should Actually Do
Keep the cards open. Keep utilization low. Do nothing in response to the factor language on the report.
Consumer sentiment has been running below 60 for much of the past year — the University of Michigan’s index registered 56.6 as of February 2026, well into pessimistic territory. That anxiety bleeds into how people read their financial documents. A confusing notation on a credit report feels like a warning when it is, in most cases, background noise.
If you are preparing for a mortgage application, pull your free annual credit reports at AnnualCreditReport.com and look for actual errors: accounts you don’t recognize, incorrect balances, or payments marked late that were made on time. Those are worth disputing. A factor code telling someone with a 780 score that they have too many credit cards is not.
The credit bureaus generate that language because they are required to. You are not required to act on it.
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