No credit card required
Browse credit cards from a variety of issuers to see if there's a better card for you.
As long as all payments are on time, FICO scoring does not account for utilization history, only current utilization. So, in theory, both scores would be the same or very close (Once the statement cuts and the new balances are reported).
@b_seeker wrote:As long as all payments are on time, FICO scoring does not account for utilization history, only current utilization. So, in theory, both scores would be the same or very close (Once the statement cuts and the new balances are reported).
Yes. No-one here (probably) knows the exact calculation used to create the actual score, but it IS based on the data in the credit report, calculated each time it is pulled. You can see that there is no utilization history in the report.
They should both be all things equal the same for your score. There is no memory in the score. So it is the same to pay it all now and keep it at 2% for 2 years and to keep it at 70% for 2 years and pay it off a month before as far as util%. As the poster before stated, it is a snapshot that is scored, not some sort of cumulative average of utilisation %.
@cowboyguy wrote:
So saying "keep util low" isn't always true, correct? I mean I can take advantage of balance transfer offers offering 0% interest, carry a balance in low interest cards all the time... And whenever I intend to apply for new credit or CLI, I simply pay off my balances.
Why not take advantage of free interest?
So I can stay in the garden with high util?
as long as you stay in the garden you will be unaffected, before you want to apply for something else, pay down your debt and make sure it reports the lower balance before applying, could take a month or 2 to update
@cowboyguy wrote:
So saying "keep util low" isn't always true, correct? I mean I can take advantage of balance transfer offers offering 0% interest, carry a balance in low interest cards all the time... And whenever I intend to apply for new credit or CLI, I simply pay off my balances.
Why not take advantage of free interest?
So I can stay in the garden with high util?
Yes, there is lots of talk about keeping util low, but as a few posters do point out, this only matters if you are going to apply for something. The only reason I can think of for always keeping util low is just in case a great very limited time offer comes out (so you can't wait a month to fix util) but this is unlikely.
So, yes, taking advantage of 0% offers makes sense (but carrying a balance on any non-zero card doesn't, if there is an alternative). And, as a smaller effect, PIF before the due date is also losing any interest the money might earn, and doing it before the statement cuts magnifies this. (One of the selling points of ccs originally was the float it gave you!)
Also remember that on this forum most people believe having all of your cards besides 1 report a 0 balance and the 1 remaining card reporting at between 1 and 9 percent utilization