Paying off balance before statement or Carrying over a balance??

[Anonymous]

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@Anonymous wrote:
Ok, is this also wise to do when rebuilding your credit.

I just got discharged from BK7 about 8 months ago.

So far I have an auto loan and two Cap1 credit cards and my credit score has been increasing.

I heard many people say that when rebuilding the best thing to do is payoff the credit card balance before the statement cuts.

So is there a difference?

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I too am wondering this, my Ch13 was discharged recently and am just now getting cards to rebuild. I do know from what i've read in the BK to 700 post he says to initially pay off when statement cuts before due date and to not charge more than 10%, but then once time passes he reccomends that you charge no more than 30% of your total credit and then pay off one card to 10% of the available balance so that it reports and the other ones need to be paid off totally so that when statement cuts it reports a 0 balance.

[bunga7]

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@0REDSOX7 wrote:

I agree with TRC_WA and follow his method.

I let whatever I use the card for report when the statement cuts, and then pay it off right away.  This last month, I put $1250 on my Barclays card and let it report that way.  Yes, more score dropped 27 points, but, it was paid in full the day I got noticed my statement was ready.  It's no big deal.  I only get OCD the month before I'm going to apply for new credit.

Less stress that way.

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I absolutely agree. I think it comes from some experience, though. The first time I made the mistake of paying all CC's off in a month and my score dropped 15 points, I freaked. But the next month I went bake ton one card carrying a small balance and the 15 pts came right back the next report. It's hard when first starting out because it seems like EVERYTHING affects your score. IMO, you're better to get a couple cards and other accounts, use them wisely and your score will build. I'm been effectively gardening for about 6 months.

To oreo: I think you and I are about the only ones that can't get back into Cap One, if I remember. The last time I tried with a pre-qualification (about a year ago) they turned me down and I decided I'd never use another hard pull on them. I'm happy with my credit union cards, and they have much better APR  

[Anonymous]

Remember, utilization has no memory. While you can definitely get the best score possible by having 1% report, just looking at the positive moves forward is enough for me. I pay the bills required and even carry a balance at times. At this point in my rebuild, getting a solid payment history month after month is more important to me than obsessing with making sure everything gets paid before the statement cuts.

When recovering from a BK, the most important thing is to find your equilibrium, your rhythm to make sure you consistently get your cards paid month after month after month. That will maximize your scores over time, then when you are ready to purchase a house or do an app spree, get that utilization down to maximize the score at that point.

Good luck!